Blog - 16/11/2018
Yet another blow to the gig economy?
The Employment Appeal Tribunal (the EAT) has upheld a previous Employment Tribunal decision that Addison Lee drivers are not self-employed and should therefore be paid the national minimum wage (NMW), in a major blow to the taxi/courier company.
This is just the latest in a long line of similar rulings against companies (including Uber and Hermes), which are part of the so-called ‘gig economy’ (please see our previous blog post: A further nail in the coffin of the gig economy).
Traditionally gig economy companies, such as Addison Lee, have maintained their drivers are self-employed (because they can, for example, choose their own hours) and therefore do not qualify for basic rights afforded to traditional employees or ‘workers’, such as NMW and holiday pay. Companies that employ such practices are now under further pressure.
In its judgment, the EAT highlighted the “unrealistic terms and conditions” that Addison Lee drivers were obliged to sign up to which did not reflect the “true nature” of the relationship, rejecting the company’s arguments that the drivers were in essence running their own businesses.
The claim against Addison Lee was brought by three individual drivers who are now, subject to any further appeal, entitled to compensation.
The thousands of other drivers working for Addison Lee are not automatically entitled to compensation. However, given the body of recent case law, there is a chance that further successful claims may follow and Addison Lee practices will have to change.
Addison Lee has not confirmed if they will appeal against this ruling of the EAT. They will likely wait for the outcome of Uber’s appeal in the long fought case on the same issue (i.e. whether their drivers are self-employed or not), which was recently heard in the Court of Appeal and is awaiting judgment.
Edwin Coe will continue to follow this matter as well as Uber’s ongoing appeal.
If you have any questions regarding this topic or any other employment issue, please contact Linky Trott or any member of the Edwin Coe Employment Team.
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