Case update | ECJ provides guidance on determining employment status
Background: The Claimant in this case, B, was a parcel delivery courier employed by Yodel Delivery Network (Yodel) under the courtier services agreement. The agreement stated that B was a self-employed independent contractor and that he:
• was to use his own vehicle and mobile phone;
• was not required to personally perform services for Yodel;
• had a right to appoint a substitute, which was subject to a limited power of veto;
• was personally liable for the acts or omissions of any substitute;
• was free to work for other delivery services, including competitor companies;
• was required to deliver parcels between 7.30am and 9pm, but otherwise could pick the time and order of deliveries; and
• was to be paid a fixed rate of remuneration set for each parcel.
Yodel was also under no obligation to provide work and B was not under any obligation to accept a particular parcel for delivery.
Facts and ECJ reasoned order: B brought claims under the Working Time Regulations, which gave rise to questions as to whether he had the status of a worker for the purposes of employment law. The Employment Tribunal at first instance decided to refer this question to the ECJ for a preliminary judgment.
Rather than issue such a judgment, the European Court of Justice (ECJ) issued what is known as a “reasoned order” and referred the matter back to the Employment Tribunal to decide. Reasoned orders can be issued under the ECJ’s rules of procedure where a question has been referred to the court which it considers “may be clearly deduced from the existing case law” or the question “admits no reasonable doubt”.
The judge in the ECJ noted that the Working Time Directive (WTD) regulations do not define ‘worker’ but that there are various judgments on this concept. It said that an essential feature of employment relationship is that a person performs services for and under the direction of another in return for remuneration, and national courts need to determine the extent this is the case based on all the circumstances. Therefore, the classification of a person as an independent contractor under national law would not prevent them from being classified as a worker under EU law, particularly if the classification is merely notional.
Some of the key factors identified by the ECJ as being determinative of worker status is having leeway to choose the type of work, the tasks to be executed, the manner in which they are to be performed, and the time and place of work. Also key is the individual having the freedom to recruit their own staff.
Turning to B, the ECJ noted that he did appear to have a “great deal of latitude” in terms of these factors and that his independence did not appear to be fictitious. It did not appear that B had a relationship of subordination with Yodel and this suggested that he did not have worker status. However, it would ultimately be up to the Employment Tribunal to determine this question.
Comment: While this case does not break any new ground, it is a useful re-statement and examination of the key factors employment tribunals should take into account when determining the employment status of individuals, particularly those working within the ‘gig’ economy.
B v Yodel Delivery Network Ltd C-692/19.
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