Employees have more employment law protection than workers, and workers have more protection than the self-employed.
This means that when ‘employers’ fall out with those who do the work, the status of the person doing the work can be in dispute.
This has been highlighted in recent years, through a series of cases where companies have argued that the people doing their deliveries are self-employed, with the deliverers arguing that they are employees or workers.
B vs. Yodel is the latest case to be considered by the Court of Justice of the European Union.
B was a Parcel Delivery Courier who worked exclusively for Yodel (sounds a bit like a worker to me).
However, B’s contract stated that he was a ‘self-employed independent contractor’.
So what? The law is clear that the label on the contract is not really relevant – it is what happens in practice that counts.
However, B’s contract also said that if he did not want to do deliveries himself, he could send along someone else to do the work – provided that person had the ability to do the work (this is known as a right of substitution).
Furthermore, B could deliver parcels for other companies, including Yodel’s competitors, and did not have to work if he didn’t want to (doesn’t sound like a worker).
Under UK law, a worker is someone who contracts to do the work personally, and cannot sub-contract the work. The employment tribunal who heard the case were concerned that this might not be compatible with European law, and therefore referred a number of questions to the Court of Justice.
The Court of Justice Decision
The Court of Justice decided that, as B could get someone else to do the work if he did not want to do it, that he could refuse to work if he wanted to, that he could work for other companies (including direct competitors), and that he could work the hours which suited him, he was not a worker protected by (for example), the Working Time Regulations.
Instead, he was self-employed.
The court did add that if the contract between B and Yodel had been a sham (i.e. if it did not reflect what happened in practice), then the situation would have been different.
What Does This Mean?
If employers are really prepared to give up enough control over the people who work for them, they can rely on self-employed contracts which contain the key elements that Yodel had written into their contract with deliverers.
However, if employers need control over the people who work for them, then self-employed contracts are not likely to work, and rather than pretend that workers or employees are self-employed, they should accept the reality of the legal status of those working for them.