In October it was ruled that British Uber drivers are entitled to national minimum wage and holiday pay. Here's what this landmark case means for you.
In a recent Employment Tribunal case it was held that Uber drivers are entitled to the national minimum wage and paid holidays. While this decision is likely to be appealed, there has been much media comment about its impact.
Briefly, the case hinged on whether the drivers were what is known as workers. While an employee can be a worker, the term also covers individuals who work personally for another person in circumstances where the individual is not in business on their own account.
In the Uber case, the Employment Tribunal did not decide that the drivers were workers because they were employees, but because they were in the category of individuals not in business on their own account.
The fact that someone is a worker does not mean, therefore, that they are automatically an employee. Clearly, however, not recognising that individuals are workers can have far reaching consequences.
Coincidentally or otherwise, it has recently been announced that HMRC is setting up a new Employment Status and Intermediaries Team. It is claimed that this dedicated resource will allow HMRC to focus its resources and expertise on ensuring these issues are effectively tackled.
Employment status has been a focus of HMRC compliance activity for many years and it looks as though there will be even more activity now. The added focus brought about by the Uber case and the so-called 'gig economy' generally means that you need to be more vigilant than ever when engaging anyone off-payroll.