A long-running court battle over the "gig economy" has ended with the UK Supreme Court upholding self-employed workers' rights – and may have knock-on effects in the Channel Islands.
Ogier counsel Rachel Richardson and senior associate Daniel Read – specialists in contentious employment law – say that yesterday's verdict in the Pimlico Plumbers case may increase the pressure in the Islands to clarify the law in respect of "gig economy" or zero hours workers.
A Jersey Employment Tribunal judgment, also published yesterday, considered the same issue of the distinction between self-employment and employment but that led to a different outcome. The case of Cole versus Jones & Le Seelleur-Jones saw a gardener's claims for unfair dismissal and unpaid holiday pay struck out because he was deemed not to have been employed. The tribunal found that although there was a "mutuality of obligations" with the people that he worked for, Mr Cole also marketed his services to others, worked the hours that he chose, took holidays and breaks when he wanted to and paid own tax.
As a result Mr Cole was operating his own business and was not an employee under the law.
Rachel said: "There is currently little clarity on this area of the law in Guernsey – minimum wage legislation contains a definition of worker but other employment protection legislation does not. Nonetheless the 'gig economy' is growing in Guernsey just as it is in the UK and employers are increasingly using or attempting to use zero hours contracts to circumvent employment rights and so it may not be long before 'gig economy' workers in Guernsey are afforded enhanced rights."
Daniel added: "Although the verdict in the Pimlico Plumbers case hinged on its own circumstances, the Guernsey and Jersey Employment Tribunals will often look to the UK and pivotal decisions such as this for guidance. There is no distinction in Jersey between a "worker" and an "employee," so the Pimlico Plumbers case is likely to be less important for employers in Jersey as a result. Zero hours or 'gig economy' workers are already protected under Jersey law.
"The Jersey case also hinged on its own circumstances, particularly that the claimant was advertising his services to other customers while working for the respondents. This decision is helpful clarification from the tribunal on when an individual offering services will be deemed to be an employee or when they will be held to be self-employed. Businesses need to take care when contracting with third parties, to ensure that they are not actually entering into an employment agreement."
Businesses who retain staff on zero hours contracts (or who rely on self-employed labour) and are not sure of their legal position or the true status of the worker should take advice – the worker may have more rights than first thought.