Johnson v Transopco UK Ltd - Employment status

In another status case, the Employment Appeal Tribunal was called upon to weigh the balance of the requirement to provide personal service against the degree of control held by the claimant, and decide which side of the self-employed / worker status debate this particular claimant fell.

LAW

Section 230(3) of the Employment Rights Act (ERA) 1996 defines a worker as follows:

(3) In this Act “worker” (except in the phrases “shop worker” and “betting worker”) means an individual who has entered into or works under (or, where the employment has ceased, worked under)— 

     (a) a contract of employment, or 

     (b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual; and any reference to a worker’s contract shall be construed accordingly.

Uber BV v Aslam (2021)

This was a significant case for the gig economy, as it was held that Uber drivers operating under the Uber licence to drive private hire vehicles were subject to such a high degree of control over their work that they in fact had worker, not self-employed, status and therefore could benefit from the associated rights, such as holiday pay. 

FACTS 

The respondent operated the “Mytaxi” App. Since 2014, the claimant had his own business driving a Hackney Carriage in London. In 2017, he started to use the drivers version of the respondents app, lightly at first and then actively between July 2017 and April 2018, alongside his own driving business in the Hackney Carriage. During that time, he earned £4,560 through business from the app, and £30,472 through his work as a self-employed driver. 

He brought a number of claims, that were reliant on his status being that of a worker. 

EMPLOYMENT TRIBUNAL (ET)

The ET held the claimant to be self-employed when doing business via the app. It was held that a contract for transportation services was created between the clamant and the respondent, which did require personal service, but this not did give him worker status. 

The reasoning here was due to the fact he could offer his services to the respondent as often, or as little, as he wanted to. He could dictate when he did this, and what control there was, was minimal (such as suspension from the app for excessive cancellations, which was found to be more about brand image than controlling the drivers). The difference in earnings, and his light use of the App, were also important to the ETs decision. 

Distinguishing this case from Uber, the ET held that the regulatory regime operated by Transport for London (TFL) in this case was key. Uber was the holder of the licence and the party subject to regulation by TFL, not the drivers, whereas in the current case much of the control the drivers were subject to was dictated directly by TFL rather than the respondent.

The matter was appealed. 

EMPLOYMENT APPEAL TRIBUNAL (EAT)

The EAT upheld the decision made by the ET in this case. It agreed that the respondent was not an employer of the claimant, but instead they were his ‘customer or client’, in accordance with section 230 (3) (b) of the ERA.

Agreeing that the regulatory regime was important, they also held that the ET was right in looking at the difference between the earnings in his Hackney Carriage driving and driving for the App, and that all factors should be taken into account when deciding status, not just personal service. His work for the App was intermittent and casual, and this could lead to an inference that he was providing a service as an independent contractor. 

The way the App works was to establish a connection between the individual wanting a taxi, and the driver. This connection then allowed for direct communication between the two parties, using TFL rates, and also allowed for future communication between them. That this happened was found to be evidence of a direct contract between the claimant and the individual, separate to that between the respondent and the claimant, and therefore an indication of him being in business himself.  

Note for employers 

This case is an important reminder to all those in the gig economy that decisions around status involve a careful weighing of all the factors, and that personal service alone is unlikely to be enough to establish worker status, especially where the degree of control is minimal. 

The model used by Mytaxi, acting as an intermediary between the driver and the passenger, is one that organisations may want to consider if they wish to avoid those providing services for them having worker status. In the case of Uber, the EAT said that was about protecting minimum rights and avoiding exploitation. That was not found to be the situation here and was another reason for distinguishing this case.

« Back to News