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Holiday Time in the Gig Economy

by Contractor Weekly

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Yet another successful employment rights claim

I would not be surprised if there was a queue of self-employed couriers and drivers lining up to claim employment rights following recent cases brought against Uber, City Sprint, Excel, eCourier and, most lately, Addison Lee Ltd.

Chris Gascoigne is the latest gig economy worker to succeed in bringing a claim for holiday pay against his engager. Supported by the Independent Workers’ Union of Great Britain, he claimed he was a “limb (b) worker” for the purposes of claiming one week’s holiday pay for the period between 1st – 16th March 2016.

Background

Mr Gascoigne was a cycle courier for Addison Lee from 2008 – March 2017.

Addison Lee is a household name, providing private hire taxis to businesses and individuals, engaging around 4,000 drivers. It also runs a small courier business of around 500 couriers, of which 30-40 are cycle couriers. The remainder are motorbikes, cars and vans. Cycle couriers operate within a small geographical area where pedal power is more likely to get a letter or parcel delivered quickly. The company offers speedy delivery, usually within an hour, to its customers (although it claims that some of its customers are in fact the courier’s customers). Couriers therefore need to be responsive and work quickly during a tightly controlled working day.

In 2008, Gascoigne was introduced to Addison Lee by a friend. He attended a short interview at their offices and met with a controller for about 10 minutes. Controllers, as the name suggests, control the couriers who are at work that day, allocate jobs, track progress by radio and GPS, and deal with queries. Each courier has a call sign allocated by the business.

As far as Gascoigne was concerned he was offered a job, worked for Addison Lee and got paid accordingly until he stopped working for the company in March of this year due to back problems.

The contract

In March 2008 Gascoigne signed his first contract, with a later requirement introduced by Addison Lee for it to be re-signed every three months in order to “refresh the relationship. As he rarely went into the office, driver liaison would usually sign it for him with an electronic signature and Gascoigne was content for them to do this.

A contract dated 20th October 2015 bound the two parties at the material time, although some of the content was not relevant to Gascoigne as it was aimed at taxi drivers. It included terms that were not repeated in previous contracts:

Relationship between the parties

The courier was an independent contractor.

Provision of services

  • Whilst the courier could choose the days and times to work, unless Addison Lee were informed otherwise, the courier would be deemed to be available and willing to work.
  • There was no obligation on the courier to provide his work at any time nor for Addison Lee to provide a minimum amount of work.
  • The courier was held liable and responsible for any employment related claim brought against Addison Lee. The tribunal judge condemned this and said that it suggested that the engager knew the risk of portraying Gascoigne as self-employed.

There was no scope for Gascoigne to negotiate the terms of his contract and his working practices never changed despite the introduction of new terms.

Integration

Whilst the contract attempted to portray an arms-length relationship this was not reflected by the content of Addison Lee’s website. The sole point of contact for customers was the Addison Lee call centre and so the customer would expect a member of their fleet to make a delivery.

Messages on the website were designed to attract people who wanted to work for a company and be directed by it. This was not language addressed to workers looking for a good agent who choose to run independent small businesses.

Business on own account

Not surprisingly, Gascoigne did not have his own website, did not market himself and saw no point in working for others even though he could have done so.

Equipment

Addison Lee supplied a radio and palm top computer/XDA and latterly an App., to enable Gascoigne to carry out the work. Although Gascoigne paid a deposit for the radio he was not required to pay any weekly rental for it.

Other company materials were provided by Addison Lee, such as a book of receipts and a branded bag of T-shirts, although Gascoigne did not use them all the time and this was not enforced. As a minimum, the courier would carry an Addison Lee ID which he was sometimes required to show to customers.

The cost of insurance for loss or damage to parcels was met by Addison Lee which was recovered from Gascoigne by way of a small weekly charge, regardless of whether Gascoigne was working or not.

The one piece of equipment Gascoigne did provide was a bicycle but which did not display a company logo.

The work

When Gascoigne was ready to work, he would contact the controller by radio or phone and log on to the system. From then on, they were constantly in touch and the controller could see his whereabouts via a GPS tracker.

Although Gascoigne had said he worked Monday – Friday, 10:00 – 18:00, he was unable to demonstrate regular working patterns. Furthermore, Addison Lee had relaxed requirements on couriers in order not to jeopardise their self-employed status and also because courier work was tiring and dangerous, so they needed to take time out to rest.

Gascoigne took full advantage of the flexible arrangements. He was a member of a band and sometimes went on tour and he also did some gardening work for a neighbour.

The order in which jobs were done were decided by the controller, who had an overview of the incoming work and its urgency, but the route was largely left to Gascoigne’s discretion. According to Gascoigne, couriers were reprimanded if they did not deliver within the hour and that they were expected to report in if there was a delay.

In between jobs, Gascoigne was on standby and kept in touch with his controller by radio, phone and app. When on standby he was expected to be in an area approved by the controller, usually near to the last drop off, so the next assignment could be plotted.

Jobs could be refused in exceptional circumstances only, for example, if the parcel was too heavy to carry or the courier had a puncture. The expectation on both sides was that if Gascoigne was given a job he would do it. In the event that a job was turned down, then the controller would pass it to another member of the team.

 

Pay

Couriers were paid weekly at a piece rate of around £3.25 per job, which averaged out to above the minimum wage. This rate was set by Addison Lee and was non-negotiable. Earnings could only be maximised by working longer or faster.

Gascoigne was also paid waiting time if he had to wait for a job, at £8 an hour for account customers or £20 an hour for non-account customers.

If a job was cancelled or the customer did not pay, Gascoigne would usually still get both job payment and waiting time.

Each week a ‘Combined Invoice/Statement’, which was akin to a payslip, was generated by Addison Lee which showed deductions for an ‘admin fee’ which was a percentage of the total and £2.58 for insurance. Gascoigne had no input or control over the figures and therefore did not have to worry about keeping his own records.

Tribunal’s findings

The tribunal judge concluded that the true contract was not that signed in October 2015 for the following reasons:

  • The work had to be personally performed by Gascoigne.
  • Gascoigne was subjected to actual control by Addison Lee. When he logged on he was controlled by the controller!
  • Gentle pressure was exerted on Gascoigne to accept jobs.
  • The classic wage/work bargain was a feature and the pay structure demonstrated that Gascoigne was not in business on his own account.
  • It appeared to the outside world that Gascoigne was part of the Addison Lee fleet and Addison Lee themselves acted like an employer who would provide him with direction and look after his needs, to include accounting and tax even though he was not in the PAYE system.

The fact that Gascoigne provided his own bike and paid for business insurance was deemed to be relatively insignificant.

With this domino ripple running through the gig economy HMRC could be rubbing their hands in anticipation of launching a challenge to the tax status of the industry’s workers. It would be difficult to envisage anything less than a Revenue massacre given that the two key areas of status, right of control and personal service, are likely to be a feature of most of these working arrangements.