Claims are being brought in the Employment Tribunals, by cycle couriers to establish that they are employees or workers, rather than independent contractors, as the Companies state that they are. The significance of this is that as independent contractors they are not entitled to the minimum wage, sickness absence, holiday pay or a number of other rights (see table below). If successful, this claim is likely to have an impact on others who may be misclassified as independent contractors.
What are the benefits of being a worker or employee?
What are the signposts?
The question of whether an individual is an employee or a worker is not always straight forward. An employee is defined under the Employment Rights Act 1996 (‘ERA’) as “an individual who has entered into or works under (or where the employment has ceased, worked under) a contract of employment”. A contract of employment is defined as “a contract of service or apprenticeship, whether express or implied, and (if it is express) whether oral or in writing”.
The question of employment status has been blurred by the evolution of the “worker” category – which is defined as an individual who has entered into work under a contract of employment or any other contract.
The Employment Appeals Tribunal laid out a test, which serves as a pointer to identify a worker in the case of Byrne Brothers (Formwork) Ltd v Baird and others:
- Personal service: did the individual undertake the contract to personally perform work of services?
- Business undertaking: was the status of the “employer” under the contract that of a customer and business undertaking carried on by the individual?
- Mutuality of obligation: was there mutuality of obligation between the individual and the “employer”?
The courier companies claim that their couriers have complete flexibility over when, whether and how they work. However, the individuals argue that in fact the couriers are completely controlled by the companies, including with GPS tracking devices to ensure that they follow instructions as to their route.
This will be an interesting case to follow in the coming months – watch this space for further developments!