Until recent years, the term ‘gig economy‘ was virtually non-existent. However, a number of high-profile cases involving organisations such as Pimlico Plumbers and Uber have put the employment status of casual workers in the spotlight.
Recently, the courts and tribunals have been tasked with determining how those working in the gig economy are engaged, and consequently what their employment rights are.
So, where does the law stand on this? At present, there are three legal categories: the self-employed, workers and employees. Nevertheless, one of the difficulties in establishing how individuals are engaged is down to the fact there is no clear statutory definition of each category. In addition, there has been much debate about what is deemed to be just and fair for the individuals, and consequently each case must be determined on its own merits.
In order to bring some certainty to this complex area, policy makers have made a number of proposals to support modern working practices. It has been suggested that there should be clearer definitions of employment status, potentially including the introduction of a new category of worker, a ‘dependent contractor’, in order to address some of the issues currently facing the UK labour market.
It has also been suggested that the onus to show employee status should be on the employer, and that there could be penalties on organisations that fail to implement previous judgments in respect of employee status without good reason.
Until such time as these recommendations are implemented, businesses should approach 2019 with employment status in mind.
It may be worth implementing an internal audit to assess and clarify the intended relationship with individuals whose employment status is not clear. In particular, it is worth considering how bank staff or those on zero hours contracts are actually engaged, as it may be that the contractual documentation is not truly reflective of the arrangement.
James Townsend is partner and head of London employment law at Michelmores