Organisations in the gig economy typically engage the bulk of their workforce as self-employed contractors, rather than as employees or workers.
Toward the end of 2016, an employment tribunal held that two Uber drivers under such self-employed contracts were in fact workers of Uber. Consequently, they were entitled to the associated rights enjoyed by workers, such as to be paid the National Minimum Wage and to be permitted appropriate rest breaks and paid time off as holiday. A different employment tribunal has now ruled that a CitySprint cycle courier who was engaged as a self-employed contractor was also, in reality, a worker and therefore entitled to the same enhanced rights.
The tribunal looked behind the words of the contract between the courier and CitySprint which purported to treat the courier as self-employed. The tribunal determined that, in fact, the arrangements were more akin to a worker relationship than true self-employment. In particular, the tribunal highlighted that:
- The courier was required to log into the CitySprint’s tracking system when she was on circuit, and log out at the end of the day. CitySprint could decide whether she could finish her shift.
- She wore a CitySprint uniform and was directed to smile to customers. She did not provide services to any other organisation.
- During her work she was directed by a controller (through radios and mobile phones).
- A disciplinary process existed if she was rude to customers and she could be disengaged as a result.
- Whilst there was provision for the courier to send a substitute in her place, the restrictions imposed meant that only another CitySprint courier could act as a substitute.
The CitySprint decision comes hot on the heels of the Uber case, which is reportedly being appealed by Uber. Similar cases are due to be heard against a number of other organisations in this sector in the coming months and it is therefore far from the end of the story. Further, the Government has launched an inquiry into the future world of work, focussing on the rapidly changing nature of work, and the status and rights of agency workers, the self-employed, and those working in the gig economy. It is hoped that this will result in some guidance for businesses in due course.
Organisations which engage self-employed contractors would be well advised to review their employment practices, consider the reality of the situation and seek legal advice. Simply labelling a relationship as self-employment will have no effect if, in practice, the relevant individual does not behave and is not treated as self-employed.