UK Employment Tribunal Rules that Individuals Working in the “Gig Economy” are Entitled to Paid Leave
An Employment Tribunal in the United Kingdom ruled that a bicycle courier for CitySprint, a delivery firm, was a worker rather than self-employed and therefore entitled to paid leave. This is the most recent decision in a string of UK cases dealing with the “gig economy,” namely, repeated short-term work such as ride-sharing or courier services.
In the most recent case, Margaret Dewhurst worked as a bicycle courier for CitySprint, a company that organized and supplied courier services. Ms. Dewhurst took two days of vacation and brought a claim against CitySprint requesting pay for those two days of leave under the United Kingdom’s Working Time Regulations. Importantly, UK legislation differentiates between individuals who are “self-employed” and workers. While workers are not entitled to the same rights as employees, they have certain rights which are not enjoyed by self-employed independent contractors, including the right to be paid the minimum wage, protections under whistleblowing legislation and the right to receive paid annual leave.
Turning to whether Ms. Dewhurst was a worker or self-employed, the Tribunal noted that she had signed a series of computer-based agreements on her first day, including that she is “a self-employed contractor” and that she is “an independent business….” The agreements were not explained to Ms. Dewhurst. Therefore, the Tribunal discounted these agreements, noting they had likely been “generated by the ‘army of lawyers’” and that they “illustrate[d] the inequality of bargaining power” between Ms. Dewhurst and CitySprint.
The Tribunal instead looked to the “true situation” of the work relationship, ruling that the while the express terms of the contract were a “key piece in the jigsaw,” they were ultimately not dispositive. Ruling that Ms. Dewhurst was a worker rather than a self-employed contractor, the Tribunal focused on her day to day work. Specifically, the Tribunal noted that:
Ms. Dewhurst tended to work established days and hours;
Ms. Dewhurst did not work for other businesses;
Ms. Dewhurst received training about how to perform her courier duties;
Ms. Dewhurst had to wear a uniform;
Ms. Dewhurst did not have full control over accepting or declining jobs;
CitSprint handled billing client; and
CitySprint allocated the jobs.
The Tribunal concluded by noting that “[o]verall, [couriers] have little autonomy to determine the manner in which their services are performed and no change at all to dictate its terms. In public, in dealings with their controllers and between themselves[,] the couriers regard themselves as part of the CitySprint family, for better and for worse.” Therefore, the Tribunal ruled that Ms. Dewhurst was a worker and entitled to paid leave.
While this decision is technically tied to the facts of the case, its reasoning will likely apply to other workers in the “gig economy” who are part of a strong corporate structure with clear requirements and oversight. In particular, it highlights the potential risk of misclassifying individuals as independent contractors when they are in fact workers. We will continue to monitor the rapidly developing law in this area.