Cases about employment status and the repercussions for employers continue, with a recent case against Yodel being found in the Company’s favour.
A courier driver for Yodel was engaged as a self-employed contractor. He was provided with a contract which contained a provision that he could provide a substitute for his work, provided the substitute was suitably qualified. Similarly the driver had a lot of freedom about when to deliver his parcels, as well as the ability to work for other delivery companies, including competitors.
These provisions proved crucial, as they suggested the individual was self-employed, a view that was shared by the Court of Justice of the European Union. In particular the Judges held that someone who is an independent contractor cannot be someone who was subordinate to their employer, which is clearly not the case if the individual has numerous freedoms compared with workers and employees.
The matter has been referred back to the Employment Tribunal for a finding of fact in relation to the Yodel driver, although it is fair to say that it is unlikely the driver will succeed due to their independence and lack of subordination.
Despite calls for the Government to intervene and legislate, the situation facing businesses remains unclear when deciding whether to engage someone as self-employed, a worker or employee. Employment status remains a complex area of employment law for the time being, as well as the continued number of tribunal claims challenging someone’s employment status.
For businesses, it is important that they get it right from the outset, as the failure to correctly identify a worker or employee could be very costly, including holiday pay. As such, employers should follow best practice when recruiting, ensuring any contractual documentation for employees, workers and self-employed contractors reflect the reality of the working relationship.
Please contact us if you require any advice on any of the employment and HR issues referred to above. Please contact Sally Morris on 01905 610410 or at firstname.lastname@example.org to discuss any frequently asked questions.