Gig economy firms dispute employee rulings

The rights of drivers operating in the gig economy (where there is a prevalence of short-term contracts or freelance work as opposed to permanent jobs) are again being considered in the courts in a major test for the employment practice.

Companies like Addison Lee, Uber and Hermes have been at the centre of legal challenges from their gig drivers who contend they are workers, rather than being self-employed.

In the latest case to pass through the courts, Addison Lee lost its appeal at an employment tribunal after an earlier hearing decided a group of drivers were entitled to national minimum wage and holiday pay rights.

Uber, which is contesting a similar decision at the Court of Appeal, argues that the courts have misunderstood the nature of its relationship with the drivers.

A previous employment tribunal ruled that drivers using the ride-hailing app were entitled to employment rights like holiday pay and guaranteed minimum wages .

Uber appealed against the decision, but the original ruling was upheld in November last year (fleetnews.co.uk, November 13, 2017).

Dinah Rose QC, acting for Uber, told the Court of Appeal drivers had a contract with Uber to use the Uber app, but the drivers entered into separate contracts with individual passengers when providing rides, with Uber acting as an agent for drivers.

An Uber spokesman told Fleet News that if drivers were classed as workers, “they would lose some of the freedom and flexibility that comes with being their own boss”.

Uber has introduced an insurance policy to cover sick pay and maternity leave, but maintains it is an app, not an employer or taxi company.

If Uber is unsuccessful in its appeal, it is expected to then take the case to the Supreme Court. This would constitute the ride-hailing company’s last method of appeal.

The Court of Appeal’s judgement is expected later this year. Addison Lee said it would review the employment tribunal’s decision before deciding whether to lodge a further appeal

GMB, the trade union that worked with legal firm Leigh Day to win the original employment tribunal case, said Uber was employing delaying tactics by appealing the earlier ruling.

Sue Harris, GMB legal director, explained: “Their decision to appeal means Uber continues to delay changing their employment practices. However, once the appeal process is over then Uber will need to make payment for the period from the date of the judgement in October 2016 as well as the period prior to the judgement when they denied our members an entitlement to holiday pay and national minimum wage.”

GMB has been involved in claims against several other operators. “We are keen to engage with companies on how their working practices need to be changed to reflect the judgements we have achieved,” explained Harris.

The Independent Workers Union of Great Britain (IWGB) organised a march protesting against the gig economy at the Court of Appeal while the Uber case was being heard.

Hundreds of protesters assembled at Transport for London (TfL) and marched to the Royal Courts of Justice, where IWGB members and co-claimants in the Uber employment rights case James Farrar and Yaseen Aslam attended the proceedings at the Court of Appeal.

Peter Lawrence, director and human resources specialist at Human Capital Department, the Kings Lynn-based HR company, told Fleet News it has seen a recent surge in the number of clients looking to move from self-employed status to employees.

He said: “I can’t really say whether this change has been due to increased requests from individuals, or whether it is more employer-led.

“We do have one client, for example, who is keen to move long standing self-employed workers on to ‘the books’ as PAYE employees, but these individuals don’t want to change. So, there is still some resistance.”

Lawrence said there is more awareness of workers’ rights due to high profile cases in the media, but substantial change will need to be driven by HMRC enforcement. He said: “I don’t see that happening as the Government is pro the gig economy and freedom of regulations in the employment market, which is a pity as some individuals are getting a raw deal.”