The employment law world has taken centre stage recently when two Uber drivers successfully claimed they were “workers” and therefore entitled to receive the national minimum wage, holiday pay and certain other rights. But this seems to be just the tip of the iceberg; claims are also in progress or threatened by City Sprint couriers and a host of other delivery firms. Other platforms like Deliveroo could also be next in line.
Although the Uber decision is very particular to the way that service is organised, most innovative businesses will be alive to the problems of fitting new business models to old employment legislation. Managing these risks will only become more difficult given the additional attention these issues have now received, as employees will be more likely to bring claims.
Alongside the Uber decision, the Employment Appeal Tribunal in Grange v Abellio held that workers do not need to have requested rest breaks in order to bring a valid claim for breach of the Working Time Regulations. This could be a useful tool for staff who were unaware of their “worker” status until recently, and have therefore not requested breaks.
The key step for businesses with atypical arrangements is to take careful stock of the position, and consider some creative planning that could reduce risks. This is likely to include documenting the relationship carefully, and giving some thought as to whether the level of control over staff can safely be reduced. Most of the tricky worker status situations – from the Stringfellow’s dancer to the Pimlico plumbers – hinge partly on the tension between a business’s desire to ensure consistent standards by regulating its staff’s activities and the need to retain flexibility in the amount of labour the staff provide. Accepting that making some sacrifices in control could yield a reduction in legal risk will be key to most companies’ strategies.
The most risk-averse course for businesses is likely to be to offer staff zero hours employment contracts; but this carries other disadvantages. Importantly, dismissals will be more difficult as staff acquire unfair dismissal rights, and businesses will have to operate a full PAYE payroll with deductions for income tax and national insurance contributions.
The broader impact of the Uber decision remains unclear; for now, the only certainty is that this will remain a hotly contested area of employment law and a focus for lawyers and business people for some years to come.