Employment Law Cases

Addison Lee v Lange

Three drivers for a taxi and courier company were ‘workers’ and not independent contractors.

Background

Mr Lange and two colleagues were private hire drivers who entered into an agreement to hire liveried cars from a company associated with Addison Lee. There was, as part of the agreement, a portable computer which each driver had to log into. Once they did, work was allocated automatically to them via the computer and they had to provide reasons if a job was refused. If they did not, they were subject to sanctions. The contractual documents described them as  independent contractors. Mr Lange and his colleagues, supported by their union, claimed that they were in fact workers and therefore entitled to rights such as the National Minimum Wage and statutory holiday pay.

A tribunal agreed with them. Addison Lee appealed the tribunal's findings that each was a worker, arguing that the tribunal had wrongly disapplied parts of the agreement in finding there was an obligation to do some work.

EAT decision

The EAT dismissed the appeal.

One of the main issues raised in the appeal was whether the tribunal was right to hold that the drivers were contractually obliged to do at least some driving work for the company, notwithstanding that the written terms they had signed up to stipulated drivers were under no such obligation. The EAT upheld the tribunal’s decision that this aspect of the agreement was irrelevant because it didn’t reflect the reality of what had been agreed. When a driver opted to log on to the computer the company used for allocating jobs, the driver had to accept a job allocated in the absence of an acceptable reason. Added to which, the company could and did impose sanctions if a driver did not accept a job allocated. The EAT was also influenced by the fact that the company provided induction, training and documentation – and almost all their drivers hired a vehicle in Addison Lee’s livery (necessitating work to pay for them).

Link to judgment: https://www.bailii.org/uk/cases/UKEAT/2018/0037_18_1411.html

Comment

This is the latest in a line of so-called ‘gig economy’ cases to hold that supposedly self-employed staff are in fact ‘workers’ and, given the facts of this case, it’s hardly a surprising result. It follows a ruling in May this year that a cycle courier working for Addison Lee’s courier business was also a worker (although there is an appeal pending in that case). The Court of Appeal is due to hear Uber’s appeal against a decision that two of its drivers were workers.

The decision is a useful reminder that, regardless of the amount of clever lawyering involved, tribunals will look at the actual substance of the relationship. Here the agreement the drivers signed required them to agree that they were ‘an independent contractor and that nothing in the agreement rendered them an employee, worker, agent or partner’ – despite the day-to-day relationship being quite different. It’s also a reminder of the continuing importance of a 2011 case - Autoclenz v Belcher – where the Supreme Court highlighted that:

‘the circumstances in which contracts relating to work or services are concluded are often very different from those in which commercial contracts between parties of equal bargaining power are agreed … frequently organisations which are offering work or requiring services to be provided by individuals are in a position to dictate the written terms which the other party has to accept. In practice, in this area of the law, it may be more common for a court or tribunal to have to investigate allegations that the written contract does not represent the actual terms agreed and the court or tribunal must be realistic and worldly wise when it does so …’

See also our guide: ‘Workers, employees and self-employed’.