‘Gig Economy’ Takes Employment Hit in Court Judgement

Companies which use short-term contracts and freelancers instead of full-time employees are reeling from shock news that could jeopardise the UK’s growing ‘Gig Economy’.

In the latest case involving controversial employment practice, Dewhurst v CitySprint UK Limited, the Central London Employment Tribunal pronounced that the latter’s contracts with its couriers did not fairly represent the reality of the couriers’ working conditions.

Ms Dewhurst was one of Citysprint’s 3,500 cyclist couriers working in London. Working four days a week, she followed regularly updated daily instruction from the company to travel between clients making deliveries.

Citysprint’s couriers were working under contracts entitled “Confirmation of Tender to Supply Courier Services to Citysprint Ltd” which defined Ms Dewhurst and her colleagues as self-employed contractors who were paid by the job. This meant the company was under no obligation to provide work, maternity rights, holiday or sick pay and stipulated that couriers were also were responsible for sending a suitable substitute to work in the event of absence.

In the Tribunal, Employment Judge Wage, finding Ms Dewhurst to be a worker for the purposes of s.230(3)(b) Employment Rights Act 1996, determined that these contractual arrangements did not reflect the realities of the parties’ arrangements.

Crucially, the Judge highlighted the fact that the couriers were made to acknowledge and sign contracts at CitySprint’s place of work, which led to the conclusion there was an inequality of bargaining power between the two parties.

‘After huge publicity and debate there is no doubt that the Gig Economy is under increasing scrutiny,’ says Verisona Law’s Head of Employment, Sue Ball. ‘Last year there were a number of cases involving the likes of Uber where contracts of employment were found to misrepresent the working conditions of the people who signed them.’

‘Zero hour contracts and freelance employment are not always as negative and divisive as recent reports would have us believe, but it is right that we need to guard against their being used to exploit and manipulate people. I have worked with a number of companies that implement them effectively and, most importantly, fairly, but judgements from cases such Dewhurst v CitySprint UK Limited are set to bring about major change.’

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