• GL
Choose your location?
  • Global Global
  • Australia
  • France
  • Germany
  • Ireland
  • Italy
  • Poland
  • Qatar
  • Spain
  • UAE
  • UK

Employment status: EAT confirms Addison Lee courier's worker status

15 May 2018
DWF | General Contracts
In the case of Addison Lee Limited v Gascoigne the Employment Appeal Tribunal ("EAT") has dismissed the Respondent's appeal against an Employment Tribunal's finding that a cycle courier was a worker and not a self-employed contractor.

Background

The Claimant, Mr Gascoigne, was a cycle courier working for Addison Lee's courier business. At the start of his engagement he was provided with a radio, palm top computer/XDA, an app, GPS tracker, branded bag and t-shirt. Addison Lee provided insurance against loss or damage to parcels and Mr Gascoigne paid for this via a small weekly charge. Mr Gascoigne's contract stated that he was an independent contractor and that while he was free to choose the days and times when he worked, when logged onto the system, he was deemed to be available and willing to provide services. When logged on to the system he generally completed 15 to 20 jobs per day and was paid at a piece rate of around £3.25 per job. He paid his own tax and National Insurance and was registered as self-employed.

Mr Gascoigne brought a claim in the Employment Tribunal for holiday pay on the basis that he was a worker.

Employment Tribunal 

The Tribunal upheld Mr Gascoigne's claim that he was a worker. The Tribunal found that the written terms of contract between the parties describing Mr Gascoigne as an "independent contractor" did not reflect the reality of the situation and that when logged on to Addison Lee's app, there was a contract with mutual obligations for jobs to be offered and accepted.
Addison lee appealed against this decision on two grounds:

  • There was no basis to conclude that Mr Gascoigne was under any legal obligation to accept jobs offered to him when logged on. His decision as to whether to accept jobs was a matter for his "whim and fancy".
  • The Employment Tribunal's "multi-factorial assessment" was littered with nine findings of factual error and should be remitted to a fresh tribunal. The multi-factorial test in essence considered all the elements that made up Mr Gascoigne's employment status.

The EAT

The EAT rejected both grounds of appeal, the Employment Tribunal's finding of worker status was upheld. In line with the worker status finding Mr Gascoigne is entitled to holiday pay. 

The Tribunal's findings clearly and sufficiently support the conclusion that, during the log on period there was a contractual relationship with the identified obligations to offer work, provided Mr Gascoigne was in an approved area, and for the offer to be accepted, provided the parcel was not too heavy. Previous case law makes it clear that practical commercial arrangements such as this can over time crystallise into legal obligations.

With regard to the second ground of appeal the EAT likened the objections to a "pernickety critique". The multi-factorial test applied by the Tribunal was not perverse and so this ground of appeal was also dismissed.

Comment

This decision follows the trend in recent employment status cases of self-employed contractors being found to have worker status. The Courts and Tribunals have been flooded with employment status cases in recent years and this heightened activity shows no sign of abating. We are eagerly awaiting the decision of the Supreme Court in the Pimlico Plumbers' case which was heard earlier this year on 20 and 21 February.

The impact of the Court of Justice of the European Union ("CJEU") decision in King v Sash Windows also needs to be considered. In this case the CJEU held that workers who have been denied the opportunity to take holiday not only accumulate leave, but can carry it over for years and are entitled to payment in lieu on termination. The CJEU decision throws into question the UK's two year back stop on unlawful deductions claims and the decision of the EAT in Bear Scotland Limited v Fulton whereby unpaid holiday cannot be claimed as the last in a series where more than three months has elapsed between deductions. Workers who have been wrongly labelled as "self-employed contractors" and as such have not been provided with an "adequate facility" to take holiday could be claiming holiday pay dating back to when they started work (or 1998 when the Working Time Regulations were introduced). If the floodgates are opened to holiday pay claims where an "adequate facility" has not been provided there is a potential significant risk to employers in the gig economy. The Sash Windows case has been reverted back to the Court of Appeal to consider how far back holiday pay claims can go and is due to be heard later this year on 20 and 21 November this year. We will keep you updated.

It is also worth noting that the Government has launched a consultation on employment status following the Taylor Review. The consultation is considering the employment status tests which have evolved from decades of case law and whether they should be codified in primary legislation. The consultation is also focusing on app-based platform workers and whether time spent waiting for tasks while logged into the app should count towards the National Minimum Wage. The consultation closes on 1 June 2018.

There is a pressing need for this complex area of law to be clarified. The direction of travel is clear, with worker status being the predominant finding. Clarity would be welcomed by all; however with Brexit to contend with it is questionable how far up the Government agenda the issue of employment status will find itself. Employers engaging individuals in the gig economy should take the time now to calculate the potential risk of a worker status finding and should consider taking appropriate steps to mitigate this risk.

Further Reading

We use cookies to give you the best user experience on our website. Please let us know if you accept our use of cookies.

Manage cookies

Your Privacy

When you visit any web site, it may store or retrieve information on your browser, mostly in the form of cookies. We mainly use this information to ensure the site works as you expect it to, and to learn how we can improve the experience in the future. The information does not usually directly identify you, but it can give you a more personalised web experience.
Because we respect your right to privacy, you can choose not to allow some types of cookies. Click on the different category headings to find out more and change permissions. However, blocking some types of cookies may prevent certain site functionality from working as expected

Functional cookies

(Required)

These cookies let you use the website and are required for the website to function as expected.

These cookies are required

Tracking cookies

Anonymous cookies that help us understand the performance of our website and how we can improve the website experience for our users. Some of these may be set by third parties we trust, such as Google Analytics.

They may also be used to personalise your experience on our website by remembering your preferences and settings.

Marketing cookies

These cookies are used to improve and personalise your experience with our brands. We may use these cookies to show adverts for our products, or measure the performance of our adverts.