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Gig economy update and the status of self-employed contractors

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Following the judgment of the Supreme Court in the Pimlico Plumbers case, UK employment lawyers predicted an upsurge in gig economy litigation – and perhaps, more importantly, more decisions in favour of the allegedly self-employed contractors challenging the working conditions of the gig economy. Since the decision that the individuals working for Pimlico Plumbers were in fact workers and not self-employed, Employment claim solicitors have taken note of the fact that the Deliveroo litigation has settled, and the Leeds Employment Tribunal has ruled that Hermes couriers are workers and not self-employed.

Settlement in the Deliveroo litigation

The Deliveroo litigation was long anticipated and had the added interest of a decision of the Central Arbitration Committee (CAC) to add to the mix. Alongside Employment Tribunal litigation, the Independent Workers Union of Great Britain (IWGB) submitted an application to the CAC to be recognised for collective bargaining for Deliveroo cycle couriers and motorbike couriers in Camden. The high court upheld the decision of the CAC that the couriers were not workers. In their view, the fact that couriers did not have to fulfil a job (or ‘gig’) themselves but could offer a substitute, defeated the argument that they were workers and not self-employed. However, after considering their position, the IWGB sought permission to judicially review the decision. Full permission for judicial review was granted in June 2018, ahead of the scheduled date of the Deliveroo Employment Tribunal case. Top employment solicitors will have noticed that not all the IWGB’s arguments were accepted. However, the high court, granting permission, said that it was arguable that the CAC should have considered the Deliveroo couriers’ right to collective bargaining under Article 11 ECHR.

The Deliveroo Employment Tribunal was due to commence in early July 2018, but the settlement of the litigation was announced at the end of June 2018. The couriers were arguing, in a claim now familiar to London employment lawyers, that they were workers and not self-employed, and their status as self-employed contractors, imposed by Deliveroo, deprived them of the national minimum wage, and holiday entitlement. The settlement was without admission of liability – and there do not appear to be any suggestions that Deliveroo is to change its business model any time soon. Whether the outcome of the Supreme Court in Pimlico Plumbers had any influence on Deliveroo’s decision to settle is not known.

The judicial review on collective bargaining rights looks set to continue regardless of the settlement of the Employment Tribunal claims, and our top employment solicitors will watch the outcome with interest.

Victory for Hermes couriers

The Leeds Employment Tribunal found in favour of a group of Hermes couriers claiming, as the Deliveroo riders before them, that they were workers and not self-employed. As a result, the Employment Tribunal found that they were entitled to the minimum wage and holiday pay and could also reclaim unlawful deductions from their wages. Although the cases were brought by just 65 couriers, Hermes employs 14,500 couriers who could all be affected by the decision, although it is possible that Hermes will appeal.

Although the Supreme Court decision in Pimlico Plumbers had not yet been delivered at the time of the preliminary hearing in the Hermes litigation, the Employment Tribunal judge considered the Court of Appeal ruling in Pimlico Plumbers when summarising the principles that apply when considering the crucial issue of ‘personal service’. The Employment Tribunal also referred to the CAC decision in the Deliveroo litigation (above).

The facts remain key – and so does credibility

Whatever the headlines, in all these cases, what is crucial is the particular set of facts that apply. It just so happens that the facts in Pimlico Plumbers, in the Uber case (currently awaiting a hearing in the Court of Appeal) and now in the Hermes litigation, have favoured the finding that the individuals bringing the claims are workers and not self-employed contractors.

When findings of fact are so crucial to the outcome of a case, it is vital that witnesses are credible – as Hermes may have learned following the decision of the Employment Tribunal. The Employment Tribunal judge had this to say about Hermes’ Head of Courier services who gave evidence on behalf of Hermes, that he was:

“…wholly unpersuasive and in respects implausible. He gave the very distinct impression that he was saying what needed to be said to support Hermes’s case that its couriers are not limb (b) workers, regardless of whether what he said was accurate…” [para 3.1]

Set against a finding that the 3 claimants in the case who gave oral evidence were “…entirely credible…” [para 3.3], it offers some explanation as to why the Employment Tribunal were unwilling to accept the factual position offered by Hermes.

We understand that Hermes are considering their position and may appeal the Employment Tribunal decision to the Employment Appeal Tribunal. We will keep you updated.

For advice and support in connection with employment law matter, whether a dispute over Employment status, a discrimination issue or settlement agreement, OTS Solicitors can help. We advise employers and employees on all aspects of employment law. To talk to an Employment lawyer in the City of London, please contact 0203 959 9123.

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