'Curtain closing' on gig economy following Addison Lee ruling, say lawyers

26 Sep 2017 By PM Editorial

Tribunal decides minicab company drivers were workers, not self-employed

Gig economy employers can no longer afford to ignore the growing legal arguments on employment status, lawyers have warned, after Addison Lee became the latest organisation to lose a tribunal on the issue.

The Central London Employment Tribunal yesterday ruled that three drivers for the minicab firm – Michaell Lange, Mark Morahan and Mieczyslaw Olszewski – should have been classified as workers, rather than self-employed, and were therefore entitled to rights such as the national minimum wage and holiday pay.

In reaching the decision, judge David Pearl concluded that, when a driver was logged onto Addison Lee’s booking system, they were agreeing to undertake any jobs personally. He also noted the degree of control Addison Lee had over the relationship, including that the use of their vehicle was “restricted and regulated” and that the drivers were not free to remove the company’s branding.

“In cases like this, and many others that have preceded it, strong evidence has shown that workers are not in control but are, in reality, subordinate to their employer,” said Helen Wolstenholme, employment barrister at 2 Temple Gardens. “Companies can no longer ignore this string of authorities. It’s looking like the curtains are closing on the gig economy.”

Kate Hurn, associate at Bird & Bird, added: “The rise of the gig economy engagement model has placed a microscope on the way in which people providing services are treated.”

There will be a further hearing of the tribunal to decide what level of holiday and pay the Addison Lee drivers are entitled to.

“We are very pleased that the employment tribunal has found in favour of our clients,” said Liana Wood from the employment team at Leigh Day, the law firm that represented the drivers. “This judgment acknowledges the central contribution that Addison Lee’s drivers have made to the success of the company by confirming that its drivers are not self-employed but that they work for Addison Lee as part of Addison Lee’s business.”

Maria Ludkin, legal director at trade union GMB, which supported the drivers in their claim, said: “This ruling means yet another logistics firm has been forced to obey the law and honour responsibilities to employees. GMB will continue to pursue these exploitative companies on behalf of our members.”

An Addison Lee spokesman said: "We note the tribunal's verdict, which we will carefully review. Addison Lee is disappointed with the ruling as we have always had, and are committed to maintaining, a flexible and fair relationship that generates work for 3,800 drivers."

Later this week, ride-hailing app Uber is due to go to the Employment Appeal Tribunal in a separate case to appeal an earlier tribunal ruling, which decided that two of its drivers were workers rather than self-employed.

Meanwhile, back in January, a tribunal decided that a cycle courier for CitySprint was a worker rather than a self-employed freelancer. The case is likely to go before the EAT before the end of the year.

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