Uber case ruling: Recruitment industry response

Last week’s landmark ruling by a London employment tribunal that Uber drivers have the right to be classed as workers rather than self-employed has triggered a range of responses from the recruitment industry.

The ruling by a London employment tribunal means drivers for the ride-hailing app will be entitled to holiday pay, paid rest breaks and the National Minimum Wage. What its implications are for the so-called ‘gig economy’, contractors and other self-employed workers remains to be seen – in the meantime, the industry associations gave their feedback on the verdict.

The Recruitment and Employment Confederation’s (REC) Chief Executive Kevin Green:
“Uber has said it intends to appeal this employment tribunal ruling, so this case is far from over. It may take quite a while to get a definitive view as it is likely to end up in front of the Supreme Court.

“In the meantime, the government should provide greater clarity to employers and individuals about who is legitimately self-employed. HMRC has already said it is investigating Hermes, but we have no timescale for a decision on this and a number of other cases.”

Julia Kermode, CEO of the Freelancer and Contractor Services Association (FCSA):
“As this case has shown, employment status is complex and it is very important that all employers learn from this case and consider how they engage their workforce. Uber paves the way for many more tribunals, as there are several firms that operate to a similar model with a substantial number of their workforce being self-employed. It is the working practices that are the most important determining factors of genuine self-employment, more so than the engagement contract and the Uber case should deter unscrupulous bosses from exploiting their workforce and denying them the benefits rightly due to them if they are actually workers.”

Tania Bowers, General Counsel at The Association of Professional Staffing Companies (APSCo): 
“This is a landmark case – while Uber classed its drivers as independent self-employed contractors who had the choice of where and when they worked, this ruling, if not successfully appealed, means that the drivers will be entitled to the minimum wage, paid holidays and breaks. While not directly affecting the professional recruitment market, the ruling will have a significant impact on the ‘gig economy’ where individuals work for multiple employers day to day without having a fixed contract.

“Recruitment firms have been responsibly supplying compliant agency workers and professional contractors to the employment market for decades before the phrase ‘gig economy’ was coined and will continue to be an essential component of the flexible labour market. Nonetheless, it is important that the recruitment sector does not get landed with the responsibility – and ensuing liability – for determining an individual’s employment status as is planned by the proposed changes to IR35 legislation for workers in the public sector.”

Commenting on the issue of IR35 legislation, Dave Chaplin, CEO and Founder of ContractorCalculator, is concerned that the Uber ruling will “arm HMRC with the ammunition to attack genuine freelancers under the rules of IR35 and I would urge all self-employed contractors to seriously consider their IR35 position.”

He added: “The Uber case does not paint the full picture of self-employment and there are thousands of self-employed freelancers who are very happy with the way they work, they do not want rights and do not see themselves as vulnerable workers.”