Addison Lee drivers found to be workers: what can we learn from the latest case on worker status?

Barely a week goes by without worker status finding its way back into the headlines. The EAT this week upheld a tribunal’s decision that three private hire drivers engaged by Addison Lee, which offers various transport services, are workers.  The EAT confirmed the tribunal’s ability to look beyond the contract in place to the reality of the working arrangements and endorsed the adoption of a “realistic and worldly-wise” approach.

The drivers sought to establish worker status in order to succeed with claims for national minimum wage and holiday pay. Addison Lee’s drivers generally hire a vehicle with Addison Lee livery from an associated company.  Drivers are given a handheld device which they log into when they wish to work.  Through that device they are assigned jobs according to location.  If a driver is assigned a job, they are expected to take it.  If they refuse, they must give an acceptable reason or face sanctions for doing so.  The contracts between Addison Lee and its drivers state that the drivers are independent contractors and that there was no obligation to offer or accept work.  Addison Lee does not guarantee a certain amount of work but drivers are told that the average driver works 50-60 hours per week.  In reality, to cover the vehicle hire costs, they needed to work at least 25-30 hours per week.

The tribunal accepted the drivers’ argument that there was an overarching agreement between each of them and Addison Lee providing for mutual obligation to offer and perform work, despite the terms of their contracts. Given the costs involved in the vehicle hire, the drivers were economically obliged to log on and earn money.  The tribunal found there was a realistic expectation of being offered work when the drivers logged on.  It went on to find that, even if they were wrong about there being an overarching agreement, once they were logged on, they were personally obliged to work, which was enough in itself to make them workers.  In a further blow to Addison Lee, the tribunal determined that drivers were working during the entire time they were logged on (except break times).

The EAT dismissed Addison Lee’s appeal. It found that this was the type of case referred to by the Supreme Court in Autoclenz Limited v. Belcher, where a tribunal has to investigate whether the written contract reflects the actual terms agreed.  The Supreme Court commented that the tribunal must be “realistic and worldly-wise” when it does so.  As a result, the EAT found the tribunal was entitled to reach the conclusions it did.

This is simply the latest in a line of cases where worker status has been established by those engaged in the gig economy.  It is a further reminder, if it were needed, that the wording of a contract offers a company no protection if it does not reflect what happens in reality.  If you wish to engage a flexible workforce then it is critical to examine how the arrangements work in practice and assess employment status realistically at the outset.

Laura Morrison

About Laura Morrison

Laura has more than 13 years' experience as an employment lawyer. Over that time, she has advised clients from a range of industries, including financial services, food and drink, logistics, manufacturing and education. She advised clients on the management of day-to-day HR issues as well as providing strategic advice on organizational change and business transfers. She regularly appeared in the Employment Tribunal across the UK and represented clients in claims such as automatically unfair dismissal on the grounds of making protected disclosures, disability discrimination and sex discrimination.

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