Lodders’ head of Employment Law, Nick Rowe, explains the case of Addison Lee Ltd v Lange, where the company had wrongly classed their drivers as self-employed contractors rather than workers. The Employment Appeals Tribunal (EAT) has upheld the decision that Addison Lee’s drivers were workers.
An overarching contract
The EAT agreed with the employment tribunal that there was an overarching contract between the parties. It also agreed with the employment tribunal’s alternative conclusion that during periods when the drivers were logged on to Addison Lee’s computerised system, they were workers.
The regular offer and acceptance of work, so that the drivers worked pretty much continuously, amply justified the conclusion that the drivers were workers. The employment tribunal had been entitled to conclude, applying Autoclenz, that the contractual documentation characterising the drivers as self-employed contractors, did not properly reflect the true agreement between the parties.
The EAT also found that there was no error of law in the employment tribunal’s conclusion that when drivers were logged on, this satisfied the definition of working time as they were at the employer’s disposal.
The EAT has upheld an employment tribunal’s finding that drivers working for Addison Lee were workers under the Employment Rights Act 1996 (ERA 1996), the Working Time Regulations 1998 (WTR 1998) and the National Minimum Wage Act 1998 (NMWA 1998). They were not genuinely self-employed independent contractors.
Mass claims on the way?
Addison Lee uses 3,800 self-employed drivers in the capital, who are all potentially affected by the case brought by Michaell Lange. Back in October 2016 Uber also lost a tribunal case brought by two of its 40,000 drivers, who argued successfully they should be treated as workers. Neither ruling automatically means all self-employed drivers will receive worker rights, but unless the firms change the contractual arrangements, they would be left open to mass claims in the employment courts.
Nick Rowe, head of Lodders Employment team comments: “This reflects the recent decisions in this area and comes as no surprise to me at all. It just further demonstrates the erosion of sense in the “Oh, it’s OK; they’re self-employed” attitude that a vast number of “employers” were guilty of. It is, in my experience, crucially important for companies to understand the nature of the relationships it has with those people that they engage. They can then structure their business in a sensible way and make well-informed decisions when assessing the risks that may exist, as a consequence.”
(Addison Lee Ltd v Lange and others UKEAT/0037/18, 14 November 2018.)
Lodders’ team of employment solicitors offer accurate, focused and solution-based legal advice to a wide range of clients. We have forged an excellent reputation for advising SME’s, publicly owned companies, charities and other bodies; as well as employees in respect of all manner of employment related issues, including in respect of the area of employment status.