Cycle courier case ‘could challenge concept of the gig economy’

Forthcoming tribunal seeks to establish that group of self-employed contractors are workers, with Uber case also pending

A forthcoming employment tribunal involving a small group of cycle couriers could have widespread repercussions for the UK’s increasing levels of self-employment, according to industrial relations experts.

The Independent Workers Union of Great Britain (IWGB) has received confirmation that the first of a planned series of crowdfunded cases against individual courier companies has been scheduled to be heard in June.

The union is planning cases against Addison Lee, CitySprint, eCourier and Excel on behalf of members who work as cycle couriers in London. The couriers are seeking a written statement to establish under the Employment Rights Act 1996 that they are not self-employed contractors.

They want to be classified as workers, which would bring employment rights, including holiday pay, that are not applicable to the self-employed.

Cycle couriers are reported to earn around £2-3 per delivery, often working long hours in the capital’s traffic-clogged streets. One IWGB courier this week told the BBC that, after an accident, he realised his parcel was insured for damage but he wasn’t, meaning he would have to return to work immediately or lose earnings.

The case, along with another forthcoming tribunal involving Uber drivers, may have broader significance. Self-employment in the UK is increasing rapidly – up by 120,000 people year-on-year to 4.64 million, according to ONS figures released this week – which is closely associated with the rise of the ‘gig economy’ of flexible workers paid for piecemeal tasks.

But critics claim many of those on the periphery of the gig economy are effectively employees who should be granted employment rights. Victory in cases such as these could have a profound effect on businesses’ ability to use self-employed contractors, and on platforms such as Uber, which are reliant on contractor labour.

Jimmy Donaghey, professor of industrial relations at the University of Warwick, said there was a long history of courts looking at the difference between employment and contracting – and that these latest cases could prove pivotal in certain sectors.

“It is essentially the difference between a contract of service, where an employee serves an organisation, and a contract for services, where a contractor is contracted to provide a function to an organisation from outside,” he said.

“The central test is often one of control – the more autonomous a person is in how they do the job, the more likely they are to be self-employed. The court would look at the extent to which a person can control when and how they do a job: do they have to wear uniform, can they get somebody else to provide the service, and so on.

“If these current cases are successful it would change practices at some companies because it would bring rights to sick pay, holiday pay, redundancy processes and unfair dismissal claims to workers who haven’t previously received them.

“Organisations with business models that manage uneven workflows would face a challenge to that model – which has often been established to explicitly avoid these obligations.”

Cloisters, the chambers that is representing the couriers, said: “The cases represent a fundamental challenge to how the entire courier industry operates.

“The companies claim their couriers have complete flexibility over when, whether and how they work. The claimants argue that in fact the couriers are completely controlled by the companies, including with GPS tracking devices to ensure they follow instructions as to their route.”

CitySprint said in a statement: “We are aware of the assertions made by the IWGB regarding the employment status of our courier fleet. We believe these are unfounded and have made this clear in the past.”

A class action case regarding a number of Uber drivers is scheduled to be heard in July, according to law firm Leigh Day, which is bringing the case. The drivers will claim they are entitled to receive the minimum wage, holiday pay and other employment protections from the taxi app.

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