Employee Employment Law Services

Uber and Out – what next for worker status?

Uber and Out – what happens next re worker status

Issue

Uber hit the headlines because of test cases brought by two drivers regarding their status – were they workers or self-employed individuals?

Facts

Uber is a San Francisco based company which has around 40,000 drivers in England and Wales.  With union support, two test cases were brought by two drivers who claimed that they should be classed as workers rather than self-employed.

Decision

On Friday, the London Employment tribunal ruled that Uber drivers were in fact workers and therefore will be entitled to holiday pay, national minimum wage (or national living wage) and paid rest breaks.  In the ruling from the tribunal, Uber were accused of “resorting in its documentation to fictions, twisted language and even brand new terminology”.

How does this affect employers?

Uber have said that they will appeal this decision but nevertheless this case will be of concern to employers as it is potentially a ground breaking decision.  It will impact not only on thousands of Uber drivers but is potentially just the tip of the iceberg as many thousands of people are employed on a similar basis in different sectors.  It may well threaten other new business models like Deliveroo and Amazon Prime Now.

It is however important to note that each case will be case sensitive and will turn on the specific arrangements in place.  Nevertheless, those employers who rely on self-employed individuals will need to watch developments carefully.

Is this really a victory for low paid workers trapped in insecure jobs or the sacrifice of the flexibility that self-employment provides to many individuals?  Many Uber drivers were happy to be self employed as they enjoyed being their own boss, choosing their level of commitment and the flexibility this provided them.

The government has of course already asked Matthew Taylor to conduct an independent review into modern working practices and now employment practices may need to change in order to keep pace with modern business models.

What we can do for you

It will be important not to make any hasty decisions as an employer.  However, self-employed individuals may begin to challenge what their status is and caution needs to be exercised by both sides in such an arrangement.

We can advise both individuals and employers on what issues to be aware of and whether the ‘label’ put on an arrangement is correct or not.  This case shows that a tribunal will be happy to look behind the title given to an arrangement to establish its true nature.

NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Aeris Employment Law Ltd will be pleased to discuss resolutions to specific legal concerns you may have.

Man jumping up, out of the sea

Holiday pay and commision – the next chapter

Holiday pay and commission – the next chapter

Issue

The issue of holiday pay and commission has had a long history through the courts and on Friday, the Court of Appeal handed down its judgement in the latest episode.

Facts

British Gas have a sales force which are paid a basic salary only along with commission on sales they achieve.  In Mr Lock’s case, his average commission made up about 60% of his salary.  When he took his holiday however he was paid only his basic pay.  Mr Lock brought a tribunal claim for his outstanding holiday pay.

The case has been in the courts for some time now and its significance is that it challenges whether British law (i.e. the Working Time Regulations 1998) can be interpreted purposively so as to give effect to EU case law which requires holiday pay to include what individuals consider to be normal elements of pay, such as results based commission and overtime.

Decision

The Court of Appeal upheld the conclusion of the EAT and has held that holiday pay must include an estimation of results based commission when calculating holiday pay.

How does this affect employers?

This decision will be of concern to employers.  The Court of Appeal was persuaded on the following points:

  • That the Working Time Regulations were only implemented to give effect to the Working Time Directive; and
  • That the UK government must have intended the Working Time Regulations to fulfil the requirements of the Working Time Directive, even if some of the obligations (such as including overtime and commission in holiday pay calculations) only became clear several years later.

Of course, in the light of Brexit, it will be interesting to see what the government decide employees are entitled to now that the UK will be leaving the UK.

What we can do for you

It will be important not to make any hasty decisions as an employer.  However, employers may now receive some enquiries from the employees as to whether their holiday pay is correct.  We can support both employees and employers in this regard.

NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Aeris Employment Law Ltd will be pleased to discuss resolutions to specific legal concerns you may have.

Shared Parental Leave

Shared Parental Leave – where are we 18 months later?

Shared Parental Leave – Where are we 18 months later?

Issue

Shared Parental Leave was introduced on 5 April 2015.  The aim was to allow both parents the option of sharing the traditional year’s maternity leave between themselves.  Has it been a revolution or is the situation relatively unchanged?

What is the take up of Shared Parental Leave?

Take up of this new entitlement has been relatively poor and, whilst it is still early days, there does not appear to have been much change in work place attitudes.  In the majority of families, it is still the mums left holding the baby.

Recent research indicates the following:

  • In 40 % of organisations, no man had taken up Shared Parental Leave.
  • Only 3000 couples took Shared Parental Leave in the first three months of 2016. This equates to just 2% of those families in which the mother took maternity leave.  This is at the lower end of the government’s forecast of a take up rate of between 2% – 8%.

What is the reason for this low uptake?

Very few employers offer enhanced parental pay schemes.  This means that the father would only be paid at the statutory rate which is currently £139.58 per week.  For many families this is not financially viable.

However, money may not be the only answer.  In Sweden, shared parental leave was introduced in 1974 – 20 years later, mothers still take 90% of the leave.  So Sweden then introduced a quota of days that the father had to take – this has increased from 30 to 90 days recently and if the time is not taken it is lost.  This has forced a change in culture where it is seen as ‘normal’ for fathers to take time off work to be with their children.

So will we see parliament introduce an exclusive right for fathers to take leave?

Is there anything I should do?

The aim of introduction of shared parental leave was to try and change society’s view that it is the mother who will always be the prime carer.

Employers may want to review their policies and the uptake of shared parental leave in their company.  Employers should also be aware that recently a Glasgow tribunal in the case of Snell v Network Rail awarded a new father almost £30,000 for sex discrimination as his employer offered enhanced contractual shared parental pay for mothers/primary adopters but not to fathers or mothers’/primary adopters’ partners.  So whilst employers need to be aware of this case, it is important to point out that this case involved how both parents were able to access the same enhanced shared parental pay scheme – this case does not address whether it is discriminatory to offer enhanced pay for mothers on maternity leave but only offer statutory pay to both mothers and fathers on shared parental leave.  The government guidance is still that there is no legal requirement to offer corresponding enhancements to shared parental pay as enhanced maternity pay falls within the pregnancy/childbirth exception.

What we can do for you

We can help you review your current shared parental leave policy to make sure it is correct and up to date.  We can advise you on the more difficult issues of whether enhanced maternity benefits should be extended to those taking shared parental leave and how to deal with challenges of requests for blocks of discontinuous leave.

NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Aeris Employment Law Ltd will be pleased to discuss resolutions to specific legal concerns you may have.