The ‘gig’ is up?

Hilary Clinton, when discussing her economic policies recently said the ‘on-demand, or so-called gig, economy is creating exciting economies and unleashing innovation. But it is also raising hard questions about workplace protections and what a good job will look like in the future’.

The ‘gig economy’ refer to the practice of companies who engage with self-employed contractors in very flexible, often temporary, arrangements. It is becoming increasingly widespread. On the one hand it is said that the gig economy creates a more a flexible working environment where those engaged can fit their jobs round other commitments such as childcare and studies. On the other hand it is argued that the arrangements deprive those who would ordinarily be considered employees or ‘workers’ the protections that come with that status.

The status of worker is a middle ground between full employee status and the minimal rights afforded to self-employed individuals.

An upcoming tribunal case involving Uber is bringing these issues to the fore. The ride sharing service has approximately 25,000 drivers in London who are classified as self-employed. In a tribunal hearing described as employment law’s ‘case of the year’, 19 Uber drivers will be arguing that they are not self-employed, but instead should be considered workers, and therefore be entitled to benefits such as the national living wage, pension contributions (where auto enrolment applies), and holiday pay.

The nature of employment status depends on many factors, including the amount of control an employer has and the nature of the business. Uber contends that they are not a taxi service but merely a platform for connecting drivers and customers; they also rely on the flexibility afforded to their drivers, who can work as much and when they want.

This case will may pave the way for fsimilar cases being launched later this year, with cycle couriers taking separate tribunal claims against Excel, City Sprint, Addison Lee and eCourier, again arguing that they should be considered workers.

As the nature of work and employment is changing, employers need to be aware of the differences in rights between employees, workers and self-employed contractors and remember that the ‘label’ placed on a relationship might have little effect on the outcome of a tribunal hearing.

Dom Bonham