Legal challenges to employment status are likely to be the big employment law story for 2017. The recent decision in relation to Uber drivers in London has opened up the floodgates for a variety of “self-employed contractors” to argue that they are in fact employees or workers.
The government is also engaged in consultation in relation to this particular subject, focussing on the so-called “gig economy”.
In a recent Employment Tribunal case, a cycle courier working for CitySprint UK Limited argued that she was a worker and therefore entitled to holiday pay.
Dewhurst v CitySprint UK Limited
Ms Dewhurst is a cycle courier making deliveries for CitySprint, who provide courier services for regular clients under service agreement and also one off deliveries. The company operates a fleet of between 50-60 cycle couriers in London, of which Ms Dewhurst was one.
Before providing their services, couriers are expected to complete a 2 day recruitment process and are then presented with a “Confirmation of Tender to Provide Courier Services”. This document sets out that the couriers are self-employed contractors and not employees or workers of CitySprint. The couriers are also asked to sign a checklist of key terms which make it clear that CitySprint are not under any obligation to provide work and the courier is equally under no obligation to provide services. It makes it clear that the courier can use a substitute to undertake work on their behalf if the substitute satisfies certain criteria. It sets out that if the courier provides no work they will receive no pay and that they are not entitled to holiday, maternity or sick pay.
Couriers indicate that they are ready for work by going “on circuit” and are then paid by the job with the routes and jobs that they do dictated by CitySprint control centres. Despite paperwork suggesting otherwise, they do not have to submit invoices as payments are automatically calculated and paid to the couriers.
Ms Dewhurst brought a claim that, notwithstanding the documentation, she was in fact a worker for the purposes of the Employment Right Act 1996 rather than a self-employed contractor. On this basis she was claiming two days holiday pay.
The Employment Tribunal acknowledged the contractual documentation but reiterated that its role was to take a step back from the contractual documentation and assess what the true nature of the relationship was. The Tribunal found that Ms Dewhurst was a worker as the “Confirmation of Tender” document did not reflect the real relationship between the parties. Essentially, the self-employment was a sham.
The Tribunal found that Ms Dewhurst was required to log on to the company’s Citytrakker tracking system when she was ready to work and also log out at the end of the day. Ms Dewhurst wore a uniform, was expected to work when she said she would and was presented with customer service standards including being told to smile when making collections / deliveries. Her work was also directed by CitySprint’s controllers through radios and mobile phones. On this basis, the tribunal found that Ms Dewhurst had very little autonomy to determine how she provides the services, that Ms Dewhurst had been recruited by CitySprint to work for the company, was integrated into the business and was therefore a worker whenever she was logged on to the Citytrakker system.
Whilst this is only an Employment Tribunal case and therefore not binding on other Employment Tribunals, it is persuasive. The decision follows the outcome in the Uber case and possibly shows a direction of travel for tribunals to become more willing to find that self-employed contractors operating in the gig economy are workers, although it will remain fact-sensitive.
We will be covering employment status as part of our employment law update seminars taking place across Cumbria and North Lancashire in March and April 2017.
If you would like to discuss employment status or any other employment law or HR queries, please do not hesitate to contact Joanne Holborn, Tom Scaife or Caroline Rayner on 01228 552600 or 01524 548494.