worker rights

Worker status

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Workers don’t have as much employment protection as employees but do have important legal rights such as paid holiday and the right to be paid the national minimum wage. Employment tribunals will look at multiple factors when deciding whether an individual is a worker or self-employed. The main ones are

  • Control – How much control does the company exert over the individual?
  • Mutuality of obligation – Is there an obligation for the company to provide work and the individual to accept it?
  • Integration – How integrated into the business is the individual?
  • Personal service – Does the individual have to do the work themselves or can they send someone else instead?
  • Running their own business – The courts will assess whether the individual is running their own business, rather than working for someone else’s business.

The issue of personal service is one which often arises in the employment tribunal. Will a contractual right of substitution – the right to send someone else to do the work – automatically rule out worker status? In Stuart Delivery v Augustine, Mr Augustine was a delivery driver. He signed up for ‘slots’ when he agreed to be online for a certain period in a certain location in return for a guaranteed minimum payment. He couldn’t work for anyone else during these slots. He had to remain in the agreed area and accept deliveries that were offered. Once signed up for a slot, he could only get out of doing it if another courier in the pool agreed to cover it. Otherwise Mr Augustine faced financial penalties or even removal from the platform.

The EAT said that this right to ‘release a slot’ back into the pool was not a free right of substitution. Only approved couriers could take the slot off Mr Augustine. He had no control over who, if anyone, would accept it. It wasn’t a right of substitution at all, rather a right to hope that another courier would release him from that obligation. If no one did, the obligation remained his. The EAT agreed that he was a worker during these periods, despite the ability to release the slots back into the pool of couriers.

Worker status cases are always fact specific. However, this decision follows other appeal judgments in showing that limited rights of substitution will not necessarily defeat a worker status claim.

Astons Solicitors
17th January 2020

TUPE

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The worker status debate leached into the TUPE sphere towards the end of 2019. A ‘worker’ is defined by section 230(3) of the Employment Rights Act 1996 (ERA) as:

An individual who…works under:

  1. A contract of employment, or
  2. Any other contract…where the individual undertakes to do or perform personally any work…for another party who…is not…a client or customer of…the individual.

TUPE is a legal mechanism which protects employees when the business they work for transfers to a new owner. TUPE defines ’employee’ as ‘any individual who works for another person whether under a contract of service or apprenticeship or otherwise‘ but does not include the genuinely self-employed. Previously there has been no case law on whether workers are covered by TUPE. Employers have considered it unlikely and usually limited TUPE obligations to employees.

Dewhurst v Revisecatch & City Sprint may have put a cat among the pigeons then. In this case, three workers said that they fell into the definition of ’employee’ under TUPE. They brought claims for holiday pay and failure to inform and consult. At a preliminary hearing to decide whether TUPE applied to them, the employment tribunal decided that workers were ’employees’ under TUPE. They were covered by the ‘or otherwise’ part of the definition. Only the genuinely self-employed were not included. The judge said that this interpretation was necessary to preserve the employment rights of those who work within businesses when they change hands.

This is an employment tribunal decision which means that other tribunals or courts don’t have to follow it. The employers are likely to appeal though, and the appeal decision will create binding law. Most employers treat workers differently to employees in a TUPE situation. If this decision is upheld on appeal, employers will need to revisit their approach to workers when considering their obligations under TUPE. With 13 weeks’ pay at stake per ’employee’ for a failure to inform and consult, any failure could be costly. Watch out for an appeal decision towards the end of the year.

Astons Solicitors
January 14th 2020