The ‘UK employment law case of the year’ hit the headlines on 28 October 2016, something that we had all been waiting for. Aslam and Others v Uber BV is a high profile case London Employment Tribunal (ET) case and looks set to be a major polluter in the already murky and muddy waters of employment rights in the gig economy.
Mr Y Aslam and Mr J Farrar are the ‘faces’ of a number of Uber cab drivers claiming they are not self-employed ‘partners’ but are actually workers under the Employment Rights Act in Great Britain. The ET had to consider a number of issues, however, there were two main facts that the drivers claimed pointed them to being workers rather than self-employed:
Uber as a Business
Uber claimed that they only provided an Application (App), which was no more than an electronic interface between passenger and driver. The drivers claimed that the business model that was operated clearly demonstrated that they were an employer providing transport services.
This relates to the time that the Uber App is switched on and the driver has accepted a job (a gig).
Mr Aslam and the others claimed that Uber had a control system under which the drivers had to operate. Not only did Uber expect the driver to perform the work personally, they also had to follow customers’ instructions. Further, Uber operate a rating system, whereby the passenger rates the journey. If this rating falls below Uber’s accepted levels, access to the App is terminated.
Uber counteracted and said that there was no obligation to switch the App on in the first place and divers supplied their own cars which they insured and fuelled.
In short, Mr Aslam and the other drivers claimed that they were not self-employed but were workers. There was never any claim that they should be regarded as employees.
The ET made the decision that:
- Uber is a business and, therefore, an employer, and
- When the driver switches on the Uber App and is ready to accept fares, they are a worker.In the gig economy, this decision has ramifications for any company that operates a business model similar to Uber, for example, Deliveroo, Hermes, Addison Lee and Yodel.
It’s all about employment status. This is not simple and, as we have seen from this and many other cases, just because they are called one status in an agreement does not actually mean that will be upheld if challenged in a court of law.
Assessing employment status is vitally important, as getting it wrong could have all sorts of unpleasant ramifications for the employer. Further, status dictates the level of employment protection that the individual can expect to receive and the employer must provide. There are three main employment types that are recognised in UK legislation:
Most commonly, this is where there is a contract of employment between an individual and an employer. Employees are afforded the highest level of protection in legislation, often the Employment Rights Act 1996 in Great Britain and the Employment Rights (Northern Ireland) Order 1996.
They are also covered under other employment legislation such as the Working Time Regulations, Equality Act (and Northern Ireland equivalents) and the Minimum Wage Act. Plus, don’t forget the Pensions Act, Health and Safety at Work Act and their Northern Ireland equivalents.
This can, broadly, be described as a situation where a contract for personal services exists between and individual and an employer. Workers have less rights than employees but are still covered under parts of the above legislation – for example, the Pensions Acts and National Minimum Wage Act applies to workers.
In employment law, the self-employed have fewest employment rights. For example, there are no obligations to pay at the National Minimum Wage, grant holiday entitlements or facilitate access to a pension scheme. However, like employees and workers, employers have to be aware that they have Health and Safety obligations. Further, there are Equality Act obligations in some instances.
The above is not intended to be a 100% representation of the legislation that applies to the three categories, merely an indication that an individual’s employment rights vary with their employment status.
With the Uber ruling, you can immediately see that the October 2016 decision by the ET has huge implications for things such as payment at the National Minimum / Living Wage, holiday entitlements and workplace pensions.
Exposing the Rights Issue
The thing that this case really exposes is the huge difference in employment rights simply as a result of being categorised in one of the three groups above. I thought I would take a look at some of the main employment rights and allocate a ‘yes’ or ‘no’ against each one depending on employment status.
|Data protection principles||Yes||Yes||Yes|
|Health and safety protections||Yes||Yes||Yes|
|Annual leave (paid)||Yes||Yes||No|
|Maximum working week||Yes||Yes||No|
|Unlawful deduction from wages protection||Yes||Yes||No|
|Whistleblowing protection||Yes||Yes||Generally no|
|Workplace pension (Auto-Enrolment)||Yes||Yes||No|
|Statutory redundancy pay||Yes||No||No|
|Minimum notice period||Yes||No||No|
|Right to request flexible working||Yes||No||No|
|Right to request job-related training||Yes||No||No|
|Statutory parental leave and pay (SMP etc)||Yes||No*||No|
|Statutory Sick Pay (SSP)||Yes||No*||No|
|Unfair dismissal protection||Yes||No||No|
|Written reason for dismissal||Yes||No||No|
* May be payable to a worker if there were Class 1 earnings.
Note that the above does not take into account the fact that there is qualifying criteria for some of the rights (e.g. redundancy pay requires service criteria and statutory payment require service and earnings criteria).
So, where are we now?
- This was an Employment Tribunal case in Great Britain. Employment Tribunals (ET) do not exist in Northern Ireland, though decisions made in Great Britain are persuasive on their judicial system
- The Tribunal is a specific first port of call in most work-related issues with an employer. As such, it is not binding on other Tribunals or courts. Even so, Uber have said that they will appeal the decision to the Employment Appeal Tribunal (EAT)
- The EAT hears appeals on decisions made at the ET stage. When they make a decision it is binding in the whole of Great Britain (which is persuasive on the judicial system in Northern Ireland)
I suspect that this victory for Uber workers is only the tip of the iceberg and nothing will be 100% resolved for some time. When it is, hopefully, the UK Government will issue some definitive guidance that will save people like me trying to explain the situation.
Employers, especially those working in the gig economy are well-advised to seek legal advice.