Court Of Appeals Rules That Addison Lee Drivers Are ‘Workers’

Last week, the Court of Appeal denied Addison Lee permission to appeal further against the finding that their drivers are ‘workers’ and not genuinely self-employed, for the purpose of various employment rights (including the national minimum wage and paid holiday).

The decision, which follows on from the recent Uber BV vs Aslam and Others judgment, is another victory for gig economy workers and could mean that thousands of Addison Lee drivers could be entitled to, on average, £10,000 each in compensation, if they make a claim against the company, and will also be entitled to the national minimum wage and paid holiday going forwards.

Addison Lee Ltd v Mr M Lange and Others

Case details

The legal action brought by the drivers (Mr Lange, Mr Olszewski and Mr Morahan) against Addison Lee began in 2017.

Under the terms of their arrangements with Addison Lee (they worked under a driver contract), the drivers were classified as independent contractors, allowing Addison Lee to fulfil its bookings with their clients and customers. Within these driver contracts, there were a number of express clauses which indicated an ‘arm’s length’ arrangement between the drivers and the business.

In reality, Addison Lee provided new drivers with induction and training documentation which specified how the drivers should undertake their jobs. Additionally, almost all drivers had to enter into a vehicle hire agreement with an associated company of Addison Lee, which meant that the drivers had to pay a weekly deposit and rental fee. Alongside these requirements, Addison Lee placed further restrictions on the drivers as to how they could use the vehicles.

Furthermore, all Addison Lee drivers were provided with a hand-held computer with which they could access the company’s portal system, which would allocate them each work based on their vehicle’s location. When a driver was sent a job via the portal system they had a choice whether to accept it. However, sanctions could be imposed by Addison Lee against a driver logged onto the system and sent a job through it, who did not accept it immediately. In some cases, a driver could be removed from Addison Lee’s system, at least temporarily, whilst an investigation was undertaken. Addison Lee were also fully responsible for agreeing fares with customers.

Mr Lange, Mr Olszewski and Mr Morahan’s claim against Addison Lee related to:

• Holiday pay under The Working Time Regulations 1998; and
• An unlawful deductions from their wages under the Employment Rights Act 1996 as the minicab firm had failed to pay them the national minimum wage for the time spent in-between jobs.

The drivers argued that they were entitled to these rights and that they should not be classified as independent contractors.

Court rulings

Both the Employment Tribunal and Employment Appeal Tribunal ruled in favour of the drivers, finding that they should be entitled to the national minimum wage and holiday pay. Both rulings stated that there was an overarching contract between the drivers and Addison Lee, and that each time the drivers logged on to Addison Lee’s driver portal system there was an undertaking to accept work they were allocated and to carry it out.

In 2019, Addison Lee sought permission to appeal both rulings after the Supreme Court had reached their decision in the aforementioned case, Uber BV vs Aslam and Others. This permission was granted. However, following the Supreme Court judgment, the Court of Appeal has now dismissed Addison Lee’s appeal with Lord Justice Bean commenting that it should not proceed as it was so unlikely to be successful.

The Court of Appeal judgment states the following:

Addison Lee has 28 days to lodge an appeal to the Supreme Court but it is not expected that the company will do so.

Comment

Following the decision in the Uber Supreme Court case, it was anticipated that it would most likely have big ramifications for those companies engaging people via digital platforms, such as Addison Lee.

Lots of businesses now operate similar business models and have really thrived in recent years, particularly companies like Deliveroo and UberEats, who engage drivers to deliver food.

As with all employment law cases, each one will turn on its specific facts but in this instance, the decision of the Court of Appeal could result in thousands of Addison Lee drivers being entitled to benefit from the national minimum wage and holiday pay, if Addison Lee retains its current business model.