You don't get to decide based on whats best for your business the relationship you legally have with the people doing the work.
Ask Uber. According to them the drivers are self employed. Courts say different.
Or Deliveroo who got a decision opposite to Uber.
If you think its a bit complicated and subject to change you are probably right...
It’s not quite accurate to say that Uber and Deliveroo had opposite decisions made, but the decisions do highlight the complexity & confusion with this area of the law.
Uber’s case was decided by an employment tribunal under the Employment Rights Act, the consideration for the employment tribunal being whether the drivers were “workers” for the purposes of that Act, if they were entitled to some basic employment rights.
Deliveroo’s case was decided under the Trade Union and Labour Relations (Consolidation) Act, the consideration for the Central Arbitration Committee being whether a (relatively small, but specific) group of riders were “workers” for the purposes of that Act. The purpose of this deliberation was to decide whether a trade union should be recognised; any decision would not have granted any worker status or rights to the individual riders in the group.
One key difference between the cases was that in Deliveroo’s case, it was found that the riders were able to send substitutes. It was very exceptional that it happened, but it was found to be an option.
If I remember Uber’s case correctly, Uber argues that (like Deliveroo) they would have no problem in theory with a substitution, but TfL require each driver to be licensed, so in practice this is not possible - not a condition of driving for Uber though, but a condition of being able to provide private carriage in London, so the argument goes this shouldn't influence things.
One big complication, as recognised by the CAC considering the Deliveroo case, is that the law varies slightly to define a worker, based on what is under consideration.
Although highly unlikely, Deliveroo riders could be given worker status by an employment tribunal, even though the CAC (applying a different law) found otherwise. And HMRC could have its own view again – so someone could be a worker/self-employed (per an employment tribunal/HMRC), but have no right to its trade union being recognised. There are three different pieces of legislation to decide who is a worker, based on what the consideration is for: tax/worker rights/union recognition.
This means the babysitter is technically self employed. I have seen a few agencies use this model in the states and have just seen one here in the UK
This is part of the argument that Uber is relying on: cab drivers have been self-employed for ever, so this is “the model”, and how dare anyone doubt that.
In reality, this has been the
assumed status of mini cab drivers for ever, but simply because no-one challenged it, all accepted it, it doesn’t mean mini cab drivers have always been, or are now, self-employed, just that it hasn’t been challenged before. (And some could now perhaps
claim a lot of holiday pay, per Cyndy's post.)
For employment law purposes, I wouldn’t worry about trade union recognition, so the consideration is for self-employed/worker/employee purposes. A case in the Supreme Court (Pimlico Plumbers, possibly to be joined by Uber), which I think is expected to be heard in February, is likely (hopefully!) to provide a lot of assistance on how to make the decisions.
For tax purposes, the HMRC tool should be fine, but worth checking with an accountant too.
It’s understandable the OP is confused though.
Karl Limpert
I'm just doing my research as we speak on the contractor-sub contractor relationship, thanks again.
