In UK employment law a person’s employment status determines both their rights and responsibilities. An individual can be an employee, a worker or self-employed.  Whilst traditionally individuals were employees or self-employed there has been a significant rise in “worker” status.  The recent reported case of Aslam and others v Uber BV considered whether drivers had rights as workers or were self-employed.  This case could have a significant impact on all workers in the “gig” economy.

A worker under UK law is defined under section 230(3) Employment Rights Act 1996 as an individual who has entered into or works under a contract of employment or any other contract…whereby the individual undertakes to do or perform personally any work or service and the employer is not a client or customer of that individual.

There have been a number of cases looking at the difference between self-employed individuals, workers and employees and tests such as the level of control imposed, whether personal service is required (or whether, for example, there is a right to “substitute”) and mutuality of obligation are applied. However, with modern working relationships the boundaries between the different statuses have become blurred and some of the “tests” may be less appropriate.

In this case, Uber claimed that the individuals are self-employed and that Uber simply provides a technology platform to facilitate the provision of taxi services. The individuals provide their own vehicles and are responsible for running costs etc, and are not required to commit to work.  However, the claimants alleged that they are workers and as such should be entitled to rights not available to self-employed individuals, including the right to the national minimum wage and holiday pay.

The Employment Tribunal found that the individuals are workers. In reaching this conclusion it looked  at the reality of the situation rather than just considering the documents themselves. Some of the points it considered included:

  • The drivers are not in a position to negotiate with the customer, they are offered and accept the trips on the terms set out by Uber.
  • Uber sets the route and sanctions may apply if the driver departs from it.
  • Conditions are applied, for example on the choice of car.
  • Uber accepted some of the financial risk.
  • A rating system applied which amounted to a performance management/disciplinary procedure.

It should be remembered that this is a tribunal decision and is therefore not binding on future cases. It is also possible that another company in the “gig” economy may in fact appoint individuals who do come within the ambit of the self-employed. The tribunal itself pointed out that Uber could have devised a business model that would have led to a different decision. Other cases referred to in the judgement provide examples of this. Uber has also indicated that it will appeal the case.

Many commentators have pointed out that people should be careful what they wish for. Some individuals operating in the “gig” economy want the flexibility in their working lives and therefore want to be viewed as self-employed.

The Department of Business Energy and Industrial Strategy has launched an inquiry into the future world of work. One of its terms of reference is whether the term ‘worker’ is defined sufficiently clearly in law at present. It will also consider the status and rights of agency workers, casual workers, and the self-employed (including those working in the ‘gig economy’), for the purposes of tax, benefits and employment law.

In addition, the Prime Minister has asked Matthew Taylor to lead an independent review into how employment practices need to change to keep pace with modern business models. This includes the extent to which the growth in non-standard forms of employment undermine the reach of policies like the National Living Wage, maternity and paternity rights, pensions auto-enrolment, sick pay and holiday pay.

Whilst we wait for these reviews to consider the ever changing world of work, we also wait to see any further claims and appeals for those working in this “gig” economy.