Are new laws needed to protect ‘gig economy’ workers?

News Article

A number of recent high profile employment tribunal cases involving gig economy workers, has led to calls for a change in the law.

The Law Society has suggested that in future all workers should be assumed to have ‘employed status’ unless it can be proven otherwise.

The Society has written to a committee of MPs arguing for changes in law to afford workers greater protection. It says that as things currently stand, employment status is not sufficiently defined in law and is calling for a ‘re-appraisal as to whether the current legal definitions are fit for purpose’.

The submission is in response to a call for evidence by the Business, Energy and Industrial Strategy (BEIS) committee on how employment rights apply within a changing work environment caused by the rise of businesses such as Uber.

According to the Society: “Often such businesses do not view themselves as employers, and have no wish to owe employment duties to those with whom they contract to provide a service.”

“The Law Society does not take a view as to whether this new model of work is a positive or negative development,” the response adds. “Our interest is in exploring how employment law can best work in the modern economy.”

Existing laws are not always clear when it comes to categorising employment status. The Law Society cites the issue of ‘employees’ and ‘workers’ enjoying different rights.

The Society told MPs: ‘The very existence of a separate category of "worker" creates uncertainty. As a result many people have no clear idea of their true legal status. This can encourage a business to try to impose a particular status, which is more closely related to what they wish the relationship to be rather than what the relationship is in reality.”

The Law Society’s calls for an overhaul of employment laws, follows news this month that a cycle courier working for the delivery firm CitySprint has succeeded in her legal battle to be paid holidays and minimum pay, which is seen as a key ruling that will affect others operating in the gig economy.

Ruling in courier Mags Dewhurst’s favour, Judge Joanna Wade at the Central London Employment Tribunal described CitySprint’s contractual arrangements as ‘contorted, indecipherable and window-dressing.’

Lara Murray, an Associate and employment law expert with Palmers, said: “The recent flurry of employment tribunal cases, coupled with the Law Society’s submission to the committee of MPs, underlines the fact that there is a great deal of confusion regarding current laws on employment status.

“It all serves to highlight the point that the nature of work is changing and businesses employing self-employed contractors or freelancers need to ensure that their contracts and terms and conditions fully comply with employment legislation.”

For help and advice relating to contracts for self-employed contractors and freelance workers, please contact us.