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Employed, Self Employed, Worker, Contractor, Freelancer, Consultant or ‘none of the above’?

Back in October of last year, an Employment Tribunal dismissed as ‘faintly ridiculous’ Uber’s assertion that its drivers were self-employed. Instead, it held they were ‘workers’. Uber appealed to the Employment Appeal Tribunal (EAT) which agreed with the tribunal that Uber drivers were workers, rather than self-employed.

What is in a name?

Employees, workers and the self-employed have different levels of protection under UK employment law and different rights and obligations attach to each. For example, an employee will acquire protection from being dismissed unfairly, a worker will not. Both employees and workers are entitled to be paid at National Minimum Wage rates and take paid holidays, self-employed people are not.

If only there were an easy and definitive test. Sadly, for those of us who advise on this subject, there is not. Uber made clear that the EAT’s decision was based on the particular facts of that case and that it may have been different if some of those facts had been different or if the wording of the contracts between Uber and its drivers had been different. Looking at the tax treatment of the pay received does not necessarily help as HMRC use a different test to determine employee status than that used for employment law purposes.

Best practice is to try and get the status right at the beginning of the relationship by looking at how the relationship between the person providing his or her labour and/or services and the person or organisation using them will work in practice. Who takes the financial risks? Who has control over how and when work is done? How integrated is the person into the workforce? Who accounts to HMRC for tax and National Insurance?  Is the person providing the service in business on their own account with the end user just one of his or her clients? These and many other factors are relevant to making that determination and recording this in a written agreement between the parties.

Contact either Justin Lewars or Heather Cowan at Employment Law Services Ltd if you think you may need advice on a worker status issue. You may find that easier than having it decided the ‘Uber’ way.



Essential Employment Law Services Ltd.
27A Dreadnought Trading Estate
Magdalen Lane

Phone: 01308 459 459
Fax: 01308 420 055
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