REWARD
The complexities of employment status
Danny Done, managing director of Portfolio Payroll, touches upon some of the challenges which arise when establishing correct employment status
B ack when the taxi world was revolutionised by Uber, it’s unlikely the owners predicted being caught up in one of the most well-known legal battles about the employment rights of their drivers. It isn’t only on this side of the Atlantic that those battles exist. While the UK Supreme Court handled a claim in 2021 regarding whether Uber drivers were self-employed or not, more recently, a claim which indirectly involved Uber drivers in the California Court of Appeal resulted in a different outcome. Different legal systems will naturally result in different conclusions when testing the same thing. The US case was concerned with whether a piece of law that enabled gig economy drivers, like Uber drivers, to be classed as independent contractors was valid. In the UK, two drivers tested, in the courts, the self-employed classification given to them by Uber. So, in the UK, Uber drivers are workers. In the US, they’re independent contractors.
But both cases, together with a multitude of others centred around the same argument, show just how alive the workforce is to the important question of their status. And why is that? Because that’s what governs their employment rights on a day-to-day level. Legislating on employment status is something the UK has so far avoided, despite indications that codifying the topic was on the cards. The Good Work Plan, issued after extensive investigations into the modern world of work by Matthew Taylor in 2017, made 53 recommendations to improve employment protection, including greater transparency around employment status. The Plan has resulted in some significant development of employment rights, particularly around written contracts of employment. But we’re yet to see any great movement on employment status. The very concept that defines the rights and entitlements of each individual, whether they’re an employee, a worker or self-
employed, remains, therefore, opaque and complicated. The position of ‘gig economy’ workers: the platform-based taxi drivers, food deliverers, couriers, etc., was given a boost by the judgment that Uber drivers weren’t to be legally classed as self-employed, despite continued protestations from the company itself. The judgment is based on the specific commercial methodology used by Uber but will have wider applications where other businesses work in essentially the same way. How do you determine employment status? Three main elements of a working relationship will always be analysed when determining employment status: l personal service l control l mutuality of obligation. These are not the only factors but are far and away the most important ones. Put very simply, personal service looks at whether the individual must do the
| Professional in Payroll, Pensions and Reward | May 2023 | Issue 90 40
Made with FlippingBook - Online magazine maker