In a further example of employment status in the gig economy being successfully challenged, the Employment Appeal Tribunal has upheld an Employment Tribunal’s decision that a cycle courier was a worker, despite his terms of engagement stating that he was an independent contractor.
Facts
The Claimant, Mr Gascoigne, was engaged as a cycle courier for Addison Lee under a contract which stated that he was an independent contractor. He was paid a piece rate per job which was determined by Addison Lee in addition to a fixed rate for waiting time and Addison Lee provided him with certain kit and equipment, including a radio for communicating with base, a palm top computer, an app, a branded t-shirt and bag.
Mr Gascoigne was able to determine the days and times he was available to work. However, when he was logged onto the Addison Lee system he was deemed to be available and willing to accept work. During logged on periods a controller based at Addison Lee was able to see his whereabouts by GPS. He could not decline a job via the app but had to contact the controller directly to re-allocate the job, therefore creating an expectation that he would accept all jobs allocated to him.
Mr Gascoigne brought a claim for holiday pay on the basis that he was a worker and not self-employed. At first instance, the Employment Tribunal held that Mr Gascoigne was a worker and that the contract did not properly reflect the reality of the working relationship between the parties. The Tribunal held that while the courier was logged onto the app he was obliged to perform work personally for Addison Lee under its control. Further, the inability for the courier to reject jobs unless there were exceptional circumstances resulted in a classic wage / work bargain consistent with worker status, thereby entitling Mr Gascoigne to statutory holiday pay.
Addison Lee appealed, arguing that the Tribunal was wrong to conclude that Mr Gascoigne had an obligation to perform work for Addison Lee as there was no obligation for him to log onto the Addison Lee app.
Decision
The EAT dismissed the appeal, concluding that the Tribunal had correctly determined that the relationship between the parties established “mutuality of obligation”, meaning that during the periods that he was logged onto the Addison Lee app there was a contractual obligation on Addison Lee to provide work and an obligation on Mr Gascoigne to accept work. The fact that Mr Gascoigne could determine when he would be available for work did not negate a worker relationship arising during those periods he was logged onto the app.
Comment
This decision follows a number of successful claims brought by individuals working in the gig economy (see our reports on Uber and City Sprint for example) and there is a clear trend of tribunals and courts being willing to establish worker status to afford some employment law rights to those individuals.
Employers should be aware that where the contractual agreement between parties does not reflect the true working relationship, it is possible for an Employment Tribunal to make its own assessment of employment or worker status. Business operating in the gig economy should be particularly careful to ensure their contractual documentation is an accurate reflection of the working reality of those they engage and to take steps to mitigate the risk of a finding of worker status.
Equally, there are learning points from these cases for all businesses for which the unexpected cost of employment status is rapidly becoming a board issue.
Rachel Collins
Lloyd Davey