The case of United Taxis Ltd v (1) Mr R Comolly (2) Mr R Tidman considered the status of a driver in respect of a taxi company that had set the rules and the individual who provided the car and with whom he had an agreement to drive. The issue was whether the driver was self employed or employed by one or both of the taxi company and individual.
Mr Comolly, a taxi driver, had registered with United Taxis in response to an advert offering training and work for taxi drivers. However, the company did not engage drivers directly but allowed its individual shareholders to engage them once registered.
Mr Tidman, a shareholder, had engaged Comolly who was then provided with a car during certain hours and expected to comply with United Taxis’ rules while taking fares. There was no written contract that set out the arrangement, but Comolly was described as being self employed. The fares received were evenly split between Tidman and Comolly.
When the working relationship came to an end Comolly made claims in the employment tribunal on the grounds that he had been either an employee or worker of United Taxis or Tidman.
The employment tribunal held that Comolly had been an employee of Tidman and a worker of United Taxis. Regarding the relationship between Comolly and Tidman, the tribunal considered that the key term relating to mutuality of obligation had been established and that there had been sufficient control exercised. Comolly had operated the taxi in return for remuneration from Tidman, who had controlled the hours the taxi was available. There was also a personal service obligation as he was not able to substitute another driver to carry out the work.
The tribunal held that sufficient control had been exercised by United Taxis in relation to Comolly’s work that a contract should be implied that he had been a worker of that business (as well as an employee of Tidman).
However, the Employment Appeal Tribunal disagreed on both issues. It held that there had been insufficient findings to support the conclusion that Comolly was an employee rather than just a worker of Tidman and that it had not been necessary to imply a contract with United Taxis when a contract with Tidman had already been found to exist.
The complex arrangements between taxi companies and individual drivers may offer some explanation as to why there are so many disputes in relation to employment status in this sector. The decision here highlights two important principles though that will be of wider significance. First, it underlines that before a contract will be implied between two parties it should be considered whether it is necessary to do so if there is already a contract in place in relation to the same work. Second, the decision casts doubt on whether there can be a finding that an individual has two employers in respect of the same work, at least in respect of statutory employment rights.
Merran Sewell is an employment partner at Gateley Legal