It’s official: I’m a worker!

Photo by Daniel Monteiro on Unsplash

Almost two years ago, I mentioned the English Court of Appeal’s decision in Uber BV & Ors v Aslam & Ors [2018] EWCA Civ 2748 on appeal from UKEAT/0056/17/DA), where individuals working as taxi drivers for Uber were to be classified as workers not self-employed individuals.

This decision was a significant defeat for Uber, but it was hardly going to be the last word in the story and so it proved. An appeal to the U.K. Supreme Court was always going to be on the cards and, on Friday 19 February, the Justices issued their judgement (see Uber BV & Ors v Aslam & Ors [2021] UKSC 5).

The Supreme Court was asked to consider two questions by Uber:

  1. Whether the drivers (the Respondents) were “workers” providing personal services to the Second Appellant.
  2. If the Respondents were “workers”, what periods constituted their “working time”.

The result? Uber drivers are workers not self-employed individuals. Essentially, the Supreme Court has approved the earlier decision of the English Court of Appeal.

Although Uber drivers won’t acquire full employment status, this decision is, nonetheless, highly significant. It will, for example, mean that Uber drivers will be protected under the National Minimum Wage legislation and the Working Time Regulations.

Paragraphs 94 to 102 of the Supreme Court’s decision are really instructive. The Court found the following matters extremely significant:

  • The rates of pay for taxi drivers was set solely by Uber
  • The contractual terms were dictated solely by Uber
  • Uber constrained or restricted the ability of drivers to decline jobs
  • Uber strictly vetted the type of vehicle which drivers could use for jobs and the technology used by drivers was “wholly owned” by Uber
  • The communication between a driver and a passenger was severely restricted by Uber in order “to prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride.”

As Lord Leggatt (who delivered the unanimous judgement of the Court) stated at paragraph 102:

Taking these factors together, it can be seen that the transportation service performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Furthermore, it is designed and organised in such a way as to provide a standardised service to passengers in which drivers are perceived as substantially interchangeable and from which Uber, rather than individual drivers, obtains the benefit of customer loyalty and goodwill. From the drivers’ point of view, the same factors – in particular, the inability to offer a distinctive service or to set their own prices and Uber’s control over all aspects of their interaction with passengers – mean that they have little or no ability to improve their economic position through professional or entrepreneurial skill. In practice the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance.

A link to the judgement can be found below:

https://www.supremecourt.uk/cases/docs/uksc-2019-0029-judgment.pdf

Workers or independent contractors?

Worker is a term which is widely used in EU equality and employment law, but a single definition does not exist. As a result of the U.K.‘s long relationship with the EU, the term has entered the British legal systems and, in the interim period, Brexit will not change this fact.

In Allonby v Accrington and Rossendale College (Case C-256/01) [2004] ICR 1328; [2004] ECR I-873 the Court of Justice made the following observation:

“… there must be considered as a worker a person who, for a certain period of time, performs services for and under the direction of another person in return for which he receives remuneration …”

In Syndicatul Familia Constanta v Directia Generala de Asistenta Sociala si Protectia Copilului Constanta (Case C-147/17) EU:C:2018:926; [2019] ICR 211, the was strongly of the opinion that the relationship between employer and worker was of a “hierarchical” nature. This was a view echoed by Lord Clarke in the Supreme Court’s decision of Hashwani v Jivraj [2011] UKSC 40; [2011] 1 WLR 1872 where he identified the relationship as one of “subordination” in favour of the person receiving the services.

That said, Baroness Hale in a later Supreme Court decision – Clyde and Co LLP and Anor v Bates van Winkelhof [2014] UKSC 32 – stated that “while subordination may sometimes be an aid to distinguishing workers from other self-employed people, it is not a freestanding and universal characteristic of being a worker”. This remark was quoted with approval by Lord Leggatt in the Uber decision at paragraph 74 of his judgement.

In other words, such a feature is merely to be deployed as one of the many possible tests that can be used by the courts to analyse a relationship between two parties.

The Employment Rights Act 1996

Section 230(1) of the Employment Rights Act 1996 contains the definition of who precisely is an employee i.e. someone who has a contract of service. If you don’t have this type of contractual arrangement (you’re not an employee), you may well be working under a contract for services. This is one of the most important distinctions in employment law in the United Kingdom.

Section 230(3) of the Act also defines in law an individual who is a ‘worker’. This can include someone who provides services under an employment contract – and, crucially, some individuals who fall into the self-employed category.

Conclusion

Individuals working under a contract for services – precisely because of their lack of employment status – are often denied access to the sorts of legal rights which employees routinely take for granted e.g. unfair dismissal protection, redundancy protection, family friendly rights.

There are notable exceptions (aren’t there always?): high earning British television celebrities (e.g. Lorraine Kelly) or a number of BBC news journalists have preferred to be treated as freelancers or self-employed persons. Why? They can then minimise their exposure to income tax liability in a way (often via the medium of personal service companies) that would not be possible because if they were employees they would almost certainly be taxed at source on a PAYE (pay as you earn) basis. 

We have seen an explosion in the type of work that is often characterised or labelled as the ‘gig economy’. This work is often characterised by a distinct lack of employment rights; irregular working patterns; chronic insecurity; lack of long term career progression; and low pay. It is often impossible for such individuals to complete the necessary periods continuous service to acquire employment rights. 

Companies such as Deliveroo, Lyft and Uber have become synonymous with the ‘gig economy’, as have whole sectors of the employment

There’s now a growing awareness on both the part of the UK Government (The Taylor Review) and the European Union (the forthcoming EU Directive on Transparent and predictable working conditions) that people on contracts for services deserve greater levels of work-place protection.

It’s not just in the UK that debates about employment status are currently playing out. At the tail end of 2019, it was with particular interest that, in 2019/20, I was following a story from the United States which highlighted many of the issues which I have just been discussing in this Blog.

The US State of California enacted a law, Assembly Bill 5 2019 or AB5 (known more popularly as the gig economy law) giving those individuals working in the gig economy more employment rights. The law came into force on 1 January 2020.

The Covid-19 pandemic has also exposed the lack of employment protection for workers and the self-employed. Only last March, I was writing about the fact that the U.K. Government’s reforms to Statutory Sick Pay would would not include approximately 2 million individuals – a situation that Frances O’Grady, General Secretary of the TUC was quick to highlight.

Related Blog articles:

https://seancrossansscotslaw.com/2019/03/25/strippers-are-workers-too-discuss/

https://seancrossansscotslaw.com/2020/02/13/california-dreamin/

https://seancrossansscotslaw.com/2020/03/05/state-of-emergency/

https://seancrossansscotslaw.com/2020/03/04/sick-pay-or-the-coronavirus-conundrum/

https://seancrossansscotslaw.com/2019/04/19/the-gig-economy/

https://seancrossansscotslaw.com/2019/07/22/good-work/

https://seancrossansscotslaw.com/2019/03/22/hello-im-lorraine-and-im-definitely-self-employed/

https://seancrossansscotslaw.com/2019/12/21/employee-or-not/

https://seancrossansscotslaw.com/2019/01/17/employment-status/

https://seancrossansscotslaw.com/2019/05/08/call-me-an-uber/

https://seancrossansscotslaw.com/2019/03/25/strippers-are-workers-too-discuss/

https://seancrossansscotslaw.com/2019/02/14/horses-for-courses-the-equine-flu-

Copyright Seán J Crossan, 21 February 2021

Welcome to Austria?

Photo by rashid khreiss on Unsplash

Willkomen (welcome) to Austria? Not if you’re Italian or someone travelling across the Austro-Italian frontier last weekend.

Why? The dramatic escalation of Coronavirus (COVID-19) outbreaks in Italy is the short answer.

The Austrian Government is very nervous about this and took emergency action by, arguably, suspending free movement provisions – if only briefly. On Sunday 23 February 2020, the Austrian authorities refused entry to its territory of a train coming from Italy for several hours. The Italian railway authorities had informed their Austrian counterparts that at least two of the passengers were exhibiting signs of a fever. The Austrians were taking no chances. The train was eventually permitted to cross the frontier.

The crisis is far from over with controls between Austria and Italy being currently considered by the Government in Vienna to deal with this public health issue.

A link to an article about this incident can be found below:

https://www.dw.com/en/coronavirus-austria-briefly-halts-trains-from-italy-over-covid-19-concerns/a-52493063

What are the legal implications of an EU member state suspending freedom of movement rules?

Italy and Austria are both member states of the European Union and free movement of persons is a key provision or fundamental freedom of the EU’s Single Market. Both countries are also part of the Schengen Agreement (from which the UK opted out whilst in the EU) which allows visa free travel between participating states. This Agreement has seen the abolition of frontier controls, to a a greater or larger extent, in many parts of Europe.

The imposition of frontier controls between EU member states is not a measure which is considered lightly.

Freedom of movement is a right which is fundamentally based on a person holding EU citizenship (or being related to a person who has citizenship). As Article 20 of the Treaty on the Functioning of the European Union (TFEU) which establishes the concept of citizenship states:

Citizenship of the Union is hereby established. Every person holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union shall be additional to and not replace national citizenship.

Article 21 TFEU declares in the following terms:

Every citizen of the [European] Union shall have the right to move and reside freely within the territory of the Member States, subject to the limitations and conditions laid down in the Treaties and by the measures adopted to give them effect.”

These freedom of movement provisions would be meaningless and ineffective if EU citizens faced discrimination on the grounds of their nationality in the host member state. Article 18 of the TFEU prohibits discrimination on the grounds of nationality (see Case 197/84 Steinhauser v City of Biarritz).

According to Article 45(5) TFEU, the free movement provisions can be derogated from i.e. disregarded on the following grounds:

  • Public security
  • Public policy
  • Public health

For its part, the Italian Government has since publicly stated that it will not be reintroducing frontier controls as an emergency measure to combat the spread of the Coronavirus:

https://www.schengenvisainfo.com/news/italy-refuses-to-suspend-schengen-agreement-amid-coronavirus-outbreak/

Attempts by member states to derogate or withdraw from the free movement provisions will not be automatically approved and the affected individuals will always be able to challenge such restrictions in the national courts or, ultimately, before the Court of Justice of the European Union (CJEU) (see, for example, Cases 115-116/81 Adoui & Cornaille; Case 41/74 Van Duyn v Home Office; Case 36/75 Rutili v Minister of Interior).

In 2009, Geert Wilders, the far right Dutch politician was refused entry to the UK because the British Government argued that his presence in the country could undermine public safety by harming race and cross-community relationships. Wilders had made a short film, Fitna, which was highly critical of Islam. He had intended to present a showing of his film at the Westminster Parliament.

Please see a link below to an article in The Guardian about the incident involving Wilders’ attempted visit to the UK:

https://www.theguardian.com/world/2009/feb/12/far-right-dutch-mp-ban-islam

The freedom of movement as originally given to EU (EEC) citizens in the Treaty of Rome had an emphasis on permitting free movement of workers and other economically active individuals. This was perhaps understandable given the labour shortages in certain EU/EEC member states immediately after the Second World War. The postwar economies of France and Belgium, in particular, benefited from hundreds of thousands of economic migrants coming from their partner state, Italy.

Although the UK was not, at this point, a member state, it faced many of the same challenges as the Six EU/EEC Founding Members, but British recruitment of labour would centre on the former (and existing) colonies of its Empire e.g. from the Caribbean (the so called ‘Windrush Generation’).

Some of the most important decisions of the Court of Justice of the European Union (CJEU) about free movement were about removing the barriers which prevented foreign (EU/EEC) nationals working or providing services in another member state (see Case 59/85 Netherlands v Reed (workers); Case 2/74 Reyners v Belgium (services); & Case 246/89 Commission v UK (Nationality of Fishermen) (establishment)).

Under the original Treaty of Rome (now to be found in the TFEU), EU citizens could take advantage of the free movement provisions by going to other member states to receive services: education, health and tourism (see Case 286/82 Luisi v Ministero del Tesero) – and many did just that.

Later, the CJEU would cement these rights by permitting family members of workers to claim entitlement to the free movement provisions of the Treaty of Rome.

That said, the freedom of movement provisions really only began to take on the dimensions of European citizenship as recently as the early 1990s after the stormy passage of the Maastricht Treaty (or the Treaty on European Union).

Underpinning the rights of free movement for individuals which are contained in primary legislation (the European Treaties) and decisions of the CJEU is the Citizens’ Directive (Directive 2004/38). This Directive really spells out (in a concrete way) the rights which EU citizens enjoy, namely, entry, residency, exit and the right to pursue employment opportunities in other member states.

Directive 2004/38 (Articles 4-14) also updated the older Directive 1612/68 (Articles 1-5) which guaranteed equal treatment and non-discrimination in employment to EU nationals residing and working in another member state.

Conclusion

The EU’s freedom of movement rules for its citizens and their dependants is a part of its fundamental law. A member state which derogates or withdraws from these rights does not do so for flimsy or superficial reasons. The TFEU does permit member states to suspend free movement provisions, but such action is always subject to the threat of possible legal action by the affected individuals; fellow member states and enforcement action by the European Commission.

Copyright Seán J Crossan, 25 February 2020

Enemies of the people?

Photo by Fred Moon on Unsplash

Have British judges become too politicised?

Michael Howard, former UK Conservative Party Leader from 2003 until 2005 (and now, somewhat ironically, an unelected member of the House of Lords) certainly thinks so – and he hasn’t been afraid to make his views known on the subject during the last few days.

A link to an article in The Independent discussing Mr Howard’s remarks can be found below:

https://edition.independent.co.uk/editions/uk.co.independent.issue.291219/data/9262576/index.html

In an interview on the BBC’s Today programme, Mr Howard posited the question as to whether the law should be made by “elected, accountable politicians, answerable to their constituents and vulnerable to summary dismissal at election, or by unaccountable, unelected judges who can’t be removed”.

Sour grapes?

To some extent, we could accuse Mr Howard of sour grapes or dissatisfaction with a number of recent legal judgements which have gone against the express wishes of the previous UK Conservative Government (2017-19) which wished to prioritise the exit of the UK from the European Union (Brexit).

It is also worth remembering that Mr Howard’s tenure as British Home Secretary (the Minister of the Interior) from 1993 until 1997 was characterised by conflicts with judges who often ruled against Government policy when making decisions about applications for judicial review.

Brexit

As a long established Eurosceptic (and as one of the prime suspects for membership of the group of “3 b*stards” in former Prime Minister John Major’s cabinet (1992-97), you would not really have expected Mr Howard to be terribly happy about the lack of progress on Brexit (some three and a half years on from the Referendum of 23 June 2016).

In R (on the application of Miller and another) v Secretary of State for Exiting the European Union [2017] UKSC 5, the former Prime Minister, Theresa May was forced to concede that she personally could not trigger Article 50 of the Treaty on European Union in order to begin the process of the UK’s withdrawal from the European Union. Brexit wasn’t going to ‘get done’ without first having undergone a series of confirmatory votes in both Houses of the Westminster Parliament. The use of the Royal prerogative (the ancient powers of the Monarch) by the then Prime Minister to ignore Parliament was not an appropriate legal action in a modern democracy.

In Wightman and Others (Notification by a Member State of its intention to withdraw from the European Union – Judgment) [2018] EUECJ C-621/18 (10 December 2018), the Court of Justice of the European Union, in a preliminary ruling, stated that a member state which had initiated Article 50 proceedings to leave the EU could reverse its decision unilaterally without first seeking the consent of all the other member states.

The request for the preliminary ruling (in terms of terms of Article 267: Treaty on the Functioning of the European Union) had been submitted by the Inner House of the Court of Session; but critically the action had been initiated by a group of democratically elected politicians (in the main).

In R (on the application of Miller) (Appellant) v The Prime Minister (Respondent) Cherry and others (Respondents) v Advocate General for Scotland (Appellant) (Scotland) [2019] UKSC 41 (On appeals from: [2019] EWHC 2381 (QB) and [2019] CSIH 49), the proverbial really hit the fan when the UK Supreme Court ruled (unanimously) that the decision by current UK Prime Minister, Boris Johnson to suspend or prorogue the Westminster Parliament for 5 weeks was nothing less than unlawful.

As Baroness Hale, President of the Supreme Court, stated:

It is impossible for us to conclude, on the evidence which has been put before us, that there was any reason – let alone a good reason – to advise Her Majesty to prorogue Parliament for five weeks, from 9th or 12th September until 14th October. We cannot speculate, in the absence of further evidence, upon what such reasons might have been. It follows that the decision was unlawful.

The Human Rights Act 1998

The mask really slips from Mr Howard’s face (possibly revealing something of the night about him?) when he turns his ire upon the effect of the Human Rights Act 1998. He begins by acknowledging that the UK Parliament conferred powers on senior judges to determine whether UK legislation was human rights compliant and then blames the judges for this situation! As a former barrister, Mr Howard really should know better.

Opponents of human rights legislation have always beaten the drum that the discretion given to (unelected) judges to attack or strike down laws which are deemed not to comply with those parts of the European Convention are a threat to British democracy. In the febrile atmosphere of Brexit, judges are now acutely aware that they can and will be accused of meddling in politics.

As I have previously remarked, statements such as Mr Howard’s recent remarks are factually incorrect when viewed through the prism of Westminster legislation. It soon becomes apparent that his arguments are highly misleading because all that superior court judges can do is to issue a declaration of incompatibility if a particular law or legal provision is found not to comply with the Human Rights Act 1998.

The declaration of incompatibility is like a football referee issuing a yellow card: foul play is being acknowledged, but the player remains on the field … for now. It will then be over to the Westminster Parliament (as the highest legal authority in the land) to bring in corrective measures to ensure that the law is changed, but this is Parliament’s decision alone

The consequences of declaring UK parliamentary legislation incompatible with the European Convention on Human Rights can be fully appreciated if we refer to the Supreme Court’s decision in R (Nicklinson) Ministry of Justice (CNK Alliance Ltd intervening) [2014] UKSC 38:

An essential element of the structure of the Human Rights Act 1998 is the call which Parliament has made on the courts to review the legislation which it passes in order to tell it whether the provisions contained in that legislation comply with the Convention. By responding to that call and sending the message to Parliament that a particular provision is incompatible with the Convention, the courts do not usurp the role of Parliament, much less offend the separation of powers. A declaration of incompatibility is merely an expression of the court’s conclusion as to whether, as enacted, a particular item of legislation cannot be considered compatible with a Convention right. In other words, the courts say to Parliament, ‘This particular piece of legislation is incompatible, now it is for you to decide what to do about it.’ And under the scheme of the Human Rights Act 1998 it is open to Parliament to decide to do nothing.”

Judicial Review

It is also apparent that Mr Howard is not a big fan of judicial review: he obviously thinks that this area of the law has expanded. True, it has but this is because the role of Government across the UK has dramatically expanded since the Second World War. This is due to a large part with the expansion of the Welfare State. Government policies which affect education, employment, health, immigration, taxation etc can be challenged by members of the public via an application for judicial review before either the Court of Session (Scotland); the High Court (England and Wales); and the High Court (Northern Ireland).

Conclusion

The UK has an unwritten Constitution – unlike other countries which have written constitutions (France, Germany, Italy and the USA). In political systems with a written constitution, there are often very clear rules governing the conduct of elected politicians.

This does not mean that, in political systems with written constitutions, the courts have no role to play. Of course they do.

It is an accepted part of the political culture of these countries that a Supreme Court or a Constitutional Court will be the final arbiter of very thorny legal and political issues e.g. the role of the US Supreme Court in legalising abortion (Roe v Wade 410 U.S. 113 (1973)) or same sex marriage (Obergefell v Hodges 576 U.S. ___ (2015)). They may be controversial in nature and generate heated debate for decades to come, but very few US citizens would contest the right of the Supreme Court to make such judgements.

As a point of contrast, note the hysteria which was generated when judges of the English High Court permitted Gina Miller’s action to succeed in blocking former Prime Minister Theresa May’s attempt to trigger Article 50 of the Treaty on European Union without, first, securing UK parliamentary approval (see R (Miller) Secretary of State for Exiting the European Union [2017] UKSC 5). 

The UK tabloid newspaper, The Daily Mail ran an astonishing front page on 4 November 2016 branding the judges “enemies of the people”. More prosaically, the High Court’s judgement (later approved by the UK Supreme Court in early 2017) was merely clarifying the law surrounding the Prime Minister’s use of the Royal prerogative in foreign affairs. You would not have thought this from the media and political reaction in certain quarters.

Governments, just as much as individuals, should not think themselves to be above the law. The rule of law in a democratic society is a principle worth hanging on to.

Copyright Seán J Crossan, 31 December 2019

Coffee, Sir?

Photo by Edward Eyer on Unsplash

You get on the plane for a routine flight between Palma de Mallorca to Vienna and, next thing, you’re thinking about instructing lawyers to pursue a personal injury claim on your daughter’s behalf.

Like billions of air travellers before him, HM probably had no idea when asked by the flight attendant whether he wanted a coffee that it would lead to legal action before the Court of Justice of the European Union (CJEU) (see Case C532/18 Niki Luftfahrt).

When we think of accidents involving airlines, we often fear the worst consequences, but what about a coffee cup which spills over and scalds a 6 year old child?

This is precisely what happened on the flight from Palma to Vienna. The coffee had been served to the child’s father (HM) and placed on his folding table. For unknown reasons, the cup tipped over and injury occurred to the child (GN).

The young girl then sought compensation for her injuries from the Austrian airline Niki Luftfahrt GmbH (which had subsequently gone into liquidation), so father took action (on her behalf) against the administrator of the airline (ZU).

The question which then arose was whether such an incident was within the meaning of the definition of ‘accident’ which is to be found within the international agreement known as the Montreal Convention. International Conventions are entered into by States to lay down common legal principles and thus avoid the (serious) problem of competing legal jurisdictions e.g. between France and the United States of America. The Montreal Convention has been incorporated into EU Law since 28 June 2004.

The Supreme Court of Austria referred the matter to the CJEU for clarification under the preliminary ruling procedure in terms of Article 267 of the Treaty on the Functioning of the European Union (TFEU).

The CJEU noted that the liability of airlines for personal injuries under the Montreal Convention is strict (see paragraph 36 of the judgement). The Court made two other observations (at paragraphs 33 and 34 of its judgement):

‘In the present case, it is apparent from the wording of Article 17(1) of the Montreal Convention that, in order to engage the liability of the carrier, the event causing the death or bodily injury of the passenger must be classified as an ‘accident’ and that accident must take place on board the aircraft or in the course of any of the operations of embarking or disembarking. …

Since the concept of ‘accident’ is not defined anywhere in the Montreal Convention, reference must be made to the ordinary meaning of that concept in its context, in the light of the object and purpose of that convention.’

So was the incident which occurred on the flight from Palma to Vienna an ‘accident’ within the meaning of the Convention?

The answer to this question was an emphatic yes from the CJEU. According to the Court, ‘the ordinary meaning given to the concept of ‘accident’ is that of an unforeseen, harmful and involuntary event.’

As the CJEU stated:

‘… the concept of ‘accident’ … covers all situations occurring on board an aircraft in which an object used when serving passengers has caused bodily injury to a passenger, without it being necessary to examine whether those situations stem from a hazard typically associated with aviation.’

Airlines can always escape liability if they can show that the injury was caused by the acts or omissions of the passenger, but in this case this was not an option.

A link to a press release summarising the details of the Court’s judgement can be found below:

http://curia.europa.eu/juris/document/document.jsf?text=&docid=221796&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=794192

A link to the judgement of the Court can be found below:

http://curia.europa.eu/juris/document/document.jsf?text=&docid=221796&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=794192

Copyright Seán J Crossan, 24 December 2019