legal

In the case of M Lange & Others v Addison Lee Limited an employment tribunal has ruled that a group of Addison Lee drivers were workers and not self-employed.

The drivers’ claims, which were supported by the trade union, GMB, were heard in the London Central Employment Tribunal in July 2017. The tribunal reached its decision in September 2017.

What is a worker?

A worker is defined under the Employment Rights Act 1996 as an individual who has entered into or works under:

  • A contract of employment.
  • Any other contract, whether express or implied, whereby the individual undertakes to do or perform personally any work or services for another party to the contract, provided the other party is not a client or customer of the individual's profession or business.

Why is employment status important?

The classification of an individual as a “worker” as opposed to “self-employed” is important. Workers are entitled to some basic employment rights, including the right to holiday pay and the national minimum wage.

What happened in this case?

The Claimants presented their case to show that they worked for Addison Lee personally as drivers in accordance with the requirements, polices and systems designed by Addison Lee, and Addison Lee was not a customer of any business that these drivers ran.

In support of this, the Claimants asserted (amongst other things) that:

  • They were required to observe Addison Lee’s dress code.
  • They were required to follow rules and standards.
  • Of the approximately 4,000 Addison Lee drivers in London, only one drove his own car. It was otherwise the case that drivers would lease their cars from an associated company of Addison Lee and sign both the driver contract and the vehicle hire agreement with Addison Lee. The use of the vehicle is restricted and regulated and drivers cannot remove the Addison Lee insignia.
  • When a driver is ready to work they log onto the system via a handheld computer. The system knows the location of the driver. When a job was notified to the driver they have to accept it, if they did not they had to give an acceptable reason as to why not. If the reason was deemed unacceptable the matter was then referred to a supervisor and a sanction may follow.
  • Spot checks were carried out to ensure drivers were wearing the correct clothing and their vehicles were clean.
  • If a driver wished to take holiday they would usually inform Addison Lee in advance.

Addison Lee argued that the Claimants could choose when they worked and that although the drivers leased their cars from an associated company of Addison Lee, they were free to obtain a vehicle elsewhere.

The Decision

In reaching its decision, the Employment Tribunal found that the drivers were undertaking to work when and as soon as they logged on. The Employment Tribunal found that constituted a strong implication of an underlying agreement and concluded there was an overarching worker contract in place. Furthermore, the Employment Tribunal held that there was expectation that the drivers would be offered work when they logged on and that expectation was realistic. The Employment Tribunal also found the drivers were undertaking to perform driving services personally and that Addison Lee was not a customer of its drivers.

The ruling means the drivers are therefore entitled to rights such as holiday pay and the national minimum wage.

Conclusion

This case again highlights that a tribunal will look at the reality of the working relationship and it is open to an Employment Tribunal to disregard the label that the parties might have stated in contractual documentation between them.

The risks of misclassifying staff as self-employed when they are in fact workers can have far-reaching implications and this case serves as a useful reminder for all companies to review their staff working arrangements.

 


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