Gig economy worker cases back in court

It's been a busy month for those interested in employment status with three cases and the tantalising promise from Greg Clark, the Business Secretary, that the government might be coming closer to acting on some of the proposals in 2017's Taylor Review, including the repeal of the Swedish derogation in agency worker contracts.

Uber continues to fight worker status

At the very end of last month, Uber's appeal against the employment tribunal finding that its drivers were workers (subsequently upheld by the Employment Appeal Tribunal).

Uber's principal argument was simple: the drivers could not be workers, because there is no contract between the drivers and the company to provide services to the company and therefore the drivers cannot fall within the definition of worker at s230(2)(b) of the Employment Rights Act. There are contracts with Uber BV which grant passengers and drivers the right to access and use the app, but any agreement for transport services is made between Uber London Ltd (ULL) as the driver's agent and the passenger. The employment tribunal and the EAT were wrong to disregard the written contract, which should have been regarded as strong evidence of the intentions of the parties, the nature of the relationship and were consistent with the reality of the situation.

Uber also argued that the tribunal was wrong to treat as "absurd" features of the relationship which were unremarkable in agency (such as not knowing the name of the other party), and to treat regulatory requirements which Uber was required to implement as mandating worker status. In the minicab industry, both agency and worker models operate.

The drivers, in response, said that Uber is a transportation provider. In fact there is no written contract between ULL and the drivers confirming the agency arrangements, and the relationship of agency has to be inferred from sources including the terms of ULL's contract with passengers, the terms of the agreement between Uber BV and the drivers, the conduct of the parties and regulatory obligations. The tribunal therefore had to decide the true nature of the agreement from all the circumstances. As in Autoclenz Limited v Belcher, these include the relative bargaining power of the parties, which may mean the written documentation does not reflect the true reality of the arrangement.

If the claimant drivers are workers, the appeal also seeks to answer the question of working time for those working through apps where (in principle, at least) they are able to log on to more than one app at the same time. Bean LJ remarked that this point – and the suggestion that workers would be able to receive multiple payments of the minimum wage for the same waiting time – troubled him. In this particular case, the claimant drivers were not 'multi-apping' but the response was that in any case, an employer is free to ban the practice and if they choose to allow it, they may put monitoring arrangements in place.

Employment Appeal Tribunal dismisses Addison Lee driver appeal

On 14 November, the EAT upheld an employment tribunal's decision that private hire drivers were workers entitled to the national minimum wage and to paid holiday. Applying the principle in Autoclenz Ltd v Belcher, the tribunal were entitled to take a "realistic and worldly wise" approach and to find that the contractual documentation did not reflect the reality of the arrangements.

Although both involve drivers, cars and passengers, Addison Lee operate slightly differently from Uber and drivers are provided with a handheld device called the XDA. When ready to work, they log in to the system which then allocates them work according to location. When a job is assigned to a driver, they are expected to accept it and must give an acceptable reason for refusing. There may be sanctions for refusals.

The tribunal found that Addison Lee did not promise any specific amount of work, but that drivers were expected to work 50-60 hours per week; in fact, a driver would need to work 25-30 hours per week to pay the fixed costs of hiring an Addison Lee branded vehicle from a group company (which they usually did).

The contract between drivers and Addison Lee stated the driver was an independent contractor and there was no obligation on either side to provide or to do any work. However, the EAT held the tribunal was entitled to find that drivers, when logged on, were undertaking to accept the jobs they were sent. This was the kind of case referred to in the Court of Appeal decision in Pimlico Plumbers v Smith where the regular offer and acceptance of work justified the conclusion that the claimants were workers. It was unrealistic to conclude that either party believed the other was under no obligation at all, said the EAT: "no honest driver" would put an employer to the expense of training and taking on the driver without planning to take on some jobs, and no "honest and reputable company" would encourage drivers to spend time and money on training and hiring a branded vehicle unless they planned to give him or her work.

Union challenges Deliveroo decision on human rights grounds

Meanwhile, the Independent Workers of Great Britain's (IWGB) judicial review challenge to the decision of the Central Arbitration Committee was heard by the Administrative Court on 14 and 15 November. The case is unusual for two reasons: it is the most well-known of the recent gig economy cases in which worker status was not upheld, and it is not being fought through the employment tribunal system.

A year ago (November 2017), the union lost a request to be recognised for collective bargaining purposes for a number of Deliveroo riders in Camden. The CAC (which hears such cases) ruled that, while a majority of Deliveroo couriers would support the IWGB's bid for collective bargaining on pay, hours and holiday, the existence and very occasional use of a substitution clause in their contracts meant that they are not workers.

The IWGB argued that denying Deliveroo riders the right to collectively bargain through their trade union amounts to a breach of the right to freedom of assembly and association at Article 11 of the European Convention of Human Rights. This includes the right to form trade unions.

What's next?

There is no indication of when the Uber or Deliveroo judgments will be handed down, but next month another case is expected to consider employment status once again, when an employment tribunal claim by the former UK Cycling team member Jess Varnish will begin. In order to succeed in her claims, she must first prove that she was a worker.

A recent news report suggested that several key recommendations of the Taylor Review may finally be implemented, following consultation earlier this year on its proposals. If true, this could mean:

• the repeal of the Swedish derogation in the Agency Workers Regulations, which allows companies to pay agency workers less than comparable permanent staff if certain conditions are met
• a right to request a fixed-hours contract after 12 months working on a zero hours contract
• changes to the calculation of continuous employment, to allow workers to build up rights which might not otherwise accrue
• changes to notice periods and a right to cancelled shift payments
• tackling non-payment of tribunal compensation awards by naming and shaming those employers which do not pay, along the lines of the existing register for non-payment of the national minimum wage
• bringing tax and employment laws on status into line.

The report suggests that the government may also attempt to codify in legislation the test for employment status. At present, it relies on an assessment of many factors against the circumstances of each individual case.

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