Tribunal Delivers Yet Another Blow for Courier Companies

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Tribunal Delivers Yet Another Blow for Courier Companies

August 24th, 2017, Blog

The latest successful challenge to self-employment status against Addison Lee is hardly surprising.  It follows similar cases against other courier companies, some of which were dealt with by the same Employment Judge.

Tribunal decisions are not legally binding although they are setting a precedent.  However, unless other Addison Lee couriers bring their own claims, there is no obligation for AL to pay them the national minimum/living wage, holiday pay and sick pay.

What will make a difference to self-employed workers is the implementation of the Taylor Review of Modern Working Practices.  This was published in July 2017 and recommends a new ‘dependent contractor’ status to replace ‘workers’ with a simplified test to determine status.  This will have more emphasis on control rather than personal service to prevent claims being defeated by a genuine substitution clause in a contract, as applies at present.  The review also recommends that the burden of proof to prove employment status should be on the employer rather than the individual.

Dependent contractors would be entitled to the national minimum/living wage, holiday pay and statutory sick pay.  They would also be entitled to a written statement of terms at the start of their engagement backed up by a standalone right to compensation for failure to comply.

However, workers could find themselves being taxed on an employed rather than self-employed basis as applies, at present.  The review recommends aligning the definition of self-employment for employment law and tax purposes.  For tax purposes individuals are either employed or self-employed (not workers).

Unfortunately, there seems to be no political will (by either main party) to implement the Taylor Report, at present. With the abolition of tribunal fees, we can expect more challenges to self-employed status, but some employers are now starting to take a different view including offering some form of sick pay for self-employed workers and limited guaranteed hours for workers on zero hours contracts.

The ruling at the Central London Employment Tribunal that the cycle courier should be classed as a ‘worker’ follows similar verdicts in cases brought against Uber, City Sprint, Excel and eCourier.

 It comes as the Government considers recommendations from a Downing Street review to bring in a new law that any self-employed worker under ‘control’ or ‘supervision’ from their contracting company should be considered a ‘dependent contractor’ and benefit from holiday pay, sick pay and the minimum wage.

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