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To determine employment status, a number of factors need to be considered. These are primarily as follows: • Mutuality of obligation – must the employer provide work and must the individual accept work provided? • Personal service – must the individual perform the work personally (ie, would it be unacceptable for that individual to send another to perform work in their place)? • Level of control – does the employer exercise significant control over the individual, for example, control over when, where and how the individual undertakes the work? If the answer to the above is yes, the individual will not be considered as genuinely self- employed for employment law purposes; he or she is either an employee or a worker. Conversely, a relationship where there is no mutuality of obligation, where an individual may send a substitute to carry out work in his or her place and where the individual has autonomy over when, where and how work is undertaken will be characteristic of self-employment: the relationship is more akin to that of two businesses contracting for the supply and provision of services rather than an individual working for and under the control and direction of another. To date, many companies operating in the gig economy have argued that individuals engaged by them are self-employed. This argument has, thus far, proved unsuccessful in the Employment Tribunal. The tribunal has particularly focused on the fact that these companies typically seek to exercise a high level of control over the individuals they engage,
which is inconsistent with genuine self-employment.
For the reasons set out above (and many other reasons), the tribunal found that the drivers were workers. Uber has appealed the decision and the appeal is due to be heard by the Employment Appeal Tribunal in September. Deliveroo The Independent Workers Union of Great Britain has applied to the Central Arbitration Committee to be the recognised union for collective bargaining purposes for a group of Deliveroo riders. The application will succeed only if the riders are workers for the purposes of the Trade Union and Labour Relations (Consolidation) Act 1992. If they are workers for the purposes of that act, it is likely they will be construed as workers more generally (and thus benefit under other employment legislation). The application is seen as a way to have the Deliveroo riders’ worker status recognised without having to go through the Employment Tribunal. Next steps The recent Work and Pensions Committee report “Self-employment and the gig economy” (April 26 2017) has challenged the idea that flexibility and employment are mutually exclusive concepts; it says that this is a myth propagated by gig economy companies. Regardless of whether this is indeed the case, the report acknowledges that the “current ways of categorising worker status are creaking under the weight of a changing economy”. The report suggests that one approach to remedy this is to assume that an individual is a worker (rather than self-employed) unless the employing entity can prove otherwise. This approach was also proposed by the Taylor Review. “Good work: the Taylor review of modern working practices” was published in July
Uber In October 2016 the tribunal determined that two Uber drivers were workers for employment law purposes and not self-employed. A key reason in the tribunal’s decision was the level of control that Uber exercises over its drivers. For example, the tribunal found that Uber controls the minimum fare drivers charge and sets the default journey route. The tribunal went on to draw parallels between subjecting the drivers to a rating system and performance management (drivers with average ratings below 4.4 are subject to “quality interventions” to help them to improve, and experienced drivers whose scores do not improve to 4.4 or above are removed from the platform and their accounts deactivated). It also noted that Uber had created a disincentive for drivers logged into the app to decline trips: once logged into the app, drivers who repeatedly declined or cancelled trips are automatically logged out for 10 minutes. These factors, along with a number of others, suggested a level of control inconsistent with genuine self-employment. The tribunal was especially critical of Uber’s convoluted contracts, which were at pains to spell out self-employed status and which the tribunal felt did not reflect the situation in reality. The tribunal also found the idea that Uber functioned solely as a platform connecting drivers and customers unconvincing. Similarly “absurd” was the notion that the relationship between the two parties was a contract under which Uber is a client or customer of a business carried on by the driver; the drivers could more accurately be described as working for Uber.
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