Employment Status and Statutory Rights

16 November 2017

Employment status and the effect on companies

Employment status has a big effect on companies especially when it comes to statutory rights.

Considering the gig economy, which is growing rapidly, two companies have dominated the news in recent weeks for this reason - Uber and Deliveroo.  One has drivers who are workers, the other has riders who are self-employed. So, what does this mean for other companies who may have similar arrangements?

Companies must carefully consider the relationship between them and those who provide services for them. The question is whether someone is truly self-employed or a worker. The answer is complex but through a wealth of case law certain key principles have been established. Two of which are; if a company controls when and how the individual provides their services it is likely the person will be considered a worker for the purposes of employment legislation. Another is that the individual must do the work and cannot send a substitute to do the work for them.

The Employment Appeal Tribunal has ruled that Uber drivers are workers, therefore, they are entitled to National Minimum Wage; paid annual leave, protection against unlawful deductions; statutory rest breaks and protection against unlawful discrimination and whistleblowing. It is likely Uber will appeal against this decision.

In contrast, a test case brought against the delivery company, Deliveroo, ruled that riders are self-employed and not workers. The majority of Deliveroo riders wanted workers’ rights and union recognition but the Central Arbitration Committee found they were self-employed because of their freedom to ‘substitute’ - in other words they can allow other riders to take their place on a job.

With this ruling they are NOT entitled to the National Minimum Wage, paid annual leave etc like the Uber workers as mentioned above.

Companies should also be mindful of arrangements they may have with volunteers; similar arrangements may result in company / worker relationships. It is recommended that companies assess their relationships with individuals and ensure they take measures to resolve any issues.

Contact Qdos for further help and advice

If you have any issues regarding employment status, statutory rights and need advice, speak with our HR consultants who will be happy to help or take a look at our HR Services.    

Meet the Qdos Experts

Hema Mistry

Solutions Delivery Team Leader

Over her 20+ years in HR, Hema draws her expert specialist knowledge from a broad range of industries including retail, consumer goods, leisure and customer service.

Kerry Bell

Senior HR & Business Partner

Kerry has over 20 years experience in HR and training. She graduated with a degree in Politics and has a Masters in HR Management and Staff Development – she is a full Chartered Member of the CIPD.

Arti Patel

HR Business Partner

Arti has a strong background in HR and is a fully qualified CIPD member. She has worked with challenging casework and has a good understanding of how to deal with workplace matters as they arise.

Ruth Frank

Employment Law Consultant

Although a career in employment law was furthest from Ruth's mind when she attained her Law Degree at Coventry University, she has since found her passion for all things HR!

Jatinder Tara

HR Employment Relations Advisor

Jatinder has a LLB Honours Law Degree and is a qualified Solicitor. With over 22 years advisory experience in Employment law and HR matters, which include Employment Tribunal litigation, he has a sound understanding of issues arising in the workplace environment and aims to deliver clear and concise client focussed advice.

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