Court of Appeal denies Addison Lee appeal following the Supreme Court's decision in Uber v Aslam.
In our 2018 article, Private hire drivers were workers and were entitled to the national minimum wage we covered an employment tribunal decision that drivers for Addison Lee, who were nominally self-employed, were in fact workers and the time during which they logged on to their employer's system was working time. Addison Lee appealed the employment tribunal's decision to the EAT, where they lost and then appealed once again to the Court of Appeal.
This case was part of a number of worker status cases progressing through the employment tribunals and court system. Many of them featured app-based businesses facing challenges from the riders and drivers who provided their services to clients, who claimed they were not independent contractors as set out in their contracts, but rather workers who were entitled to paid holiday and the national minimum wage.
The Addison Lee Court of Appeal case was delayed to allow the Supreme Court to decide Uber BV and others v Aslam and others, seen as the leading case in this series. The Supreme Court delivered the Uber decision earlier this year, which we looked at in our recent article, Supreme Court confirms that the Uber drivers are workers after denying appeal.
Case details: Addison Lee v Lange [2021]
The claimants were private hire drivers. They brought claims for national minimum wage and holiday pay, both of which require worker status.
An employment tribunal found that the written contracts did not reflect the reality of the working relationship between the parties, which stated that the drivers were not obliged to work for Addison Lee and Addison Lee was not obliged to provide them with work. The tribunal found there was an overarching contract due to the economic reality of the relationship. In particular, the fact that the drivers rented their vehicle from Addison Lee meant they did not have the freedom to not work for the company.
The tribunal highlighted that the drivers had to use a device called an XDA through which the drivers accessed work. If a driver were logged in and did not accept a job that was provided to them through the XDA they had to have a good reason for refusing it. If a job controller from Addison Lee felt that the reason wasn't good enough, the matter could be referred to a supervisor and disciplinary sanctions might follow.
The tribunal also determined that there was considerable control of the drivers by Addison Lee. This included induction and training, a requirement of drivers to abide by the company's code of conduct and potential sanctions for insubordination. Addison Lee argued that the drivers entered contracts with each client via their app as independent contractors, but the tribunal found that the drivers had no knowledge or control over the fare, which was agreed between the customer and Addison Lee. The tribunal concluded that there was no contract between driver and the passengers and the relationship between the driver and Addison Lee was not that of contractor and client due to the level of control Addison Lee exercised over them.
The employment tribunal concluded that the Addison Lee drivers were workers, entitled to national minimum wage and holiday pay.
On appeal, the EAT held that the employment tribunal was entitled to reach the decision it had, and that the tribunal was able to disregard the terms of the contract between Addison Lee and its drivers if it found on inspection the reality of the relationship was different to that presented in the contract.
Finally, following the Supreme Court Uber decision, the Court of Appeal denied Addison Lee the right to appeal and thereby confirmed that the drivers were workers.
Wrigleys' comment
This case mirrors the outcome of the Uber decision because of how closely the two platforms operate their services and engage their drivers. However, this does not mean that every taxi or delivery service operated via an app has seen its drivers or riders granted worker status and the associated rights. For example, the decision of the Central Arbitration Committee (CAC) in the case of the Independent Workers Union of Great Britain against Deliveroo, found that Deliveroo riders were not workers.
The Deliveroo decision was distinguished on the basis that the CAC found that Deliveroo riders had a genuine right to substitute another rider in their place when a job was offered, which was a key factor in deciding whether the riders were independent contractors. As set out above, the lack of genuine independence was something the tribunals and courts made an effort to highlight when considering the relationship between Addison Lee or Uber and their drivers.
The decisions in these cases further highlight that the worker status of individuals who engage with businesses via an app platform will ultimately be determined by scrutiny of the day-to-day reality of that relationship and the degree to which the individuals are free to pick and choose their jobs. In this sense, the modern working practices of engaging via an app platform have been brought into line with long-established legal principles on this issue.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
