Addison Lee drivers have worker status, EAT holds

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Private hire drivers at the company Addison Lee were ‘workers’, a status entitling them to the national minimum wage and paid annual leave, the EAT has confirmed. Despite the fact that neither the drivers in question were contractually obliged to accept work, nor Addison Lee under any obligation to offer it, the EAT upheld an earlier employment tribunal’s decision, stating that it had been entitled to find that, in reality, the working arrangements did reflect this.

The three drivers concerned had to demonstrate that they were ‘workers’ as defined by the Employment Rights Act 1996, the Working Time Regulations 1998 (WTR) and the National Minimum Wage Act 1998, in order to be awarded the holiday pay and national minimum wage for which they had brought claims.  

The employment tribunal duly considered their working arrangements and the contracts to establish whether the individuals could be classed as ‘workers’.

In relation to the former, it is common practice for Addison Lee’s private hire drivers to hire vehicles in the company’s livery and for them to login via hand-held devices when they are available for work. In this way, Addison Lee is then able to allocate jobs, according to their location, with the expectation that the assignment is accepted unless the driver can provide an acceptable reason for not doing so. If they refuse to accept the work offered then they may be sanctioned. Using their hand-held devices, drivers can notify Addison Lee when they are taking a break or going home and they can log off at any time when they are not driving with a customer.  Addison Lee told drivers that the average working week was 50-60 hours per week, and that they would have to work between 25-30 hours per week to cover their vehicle hire costs.

Addison Lee drivers signed a Vehicle Hire Agreement (VHA) with an associated company that hires the vehicles, and a Driver Contract. Drivers agreed that the associated company could request that sums due under the VHA could be paid out of the driver’s earnings under the Driver Contract. The Driver Contract stipulated that the drivers were independent contractors and could choose the days when they worked, with no obligations on either party.

However, accepting that, despite the terms of the Driver Contract, there was indeed an overarching mutual obligation to offer and perform work, the employment tribunal concluded that the drivers were workers as defined by the Employment Rights Act 1996. It found that, the drivers had an economic obligation to work sufficient hours to cover their vehicle hire costs and were given a realistic expectation of being offered work when they logged on. Furthermore, drivers were obliged to do work personally once they logged on and were working for the time that they were logged on, regardless of whether they were actually driving, since they were available to the company.

Addison Lee’s appeal to the EAT was dismissed. It held that the tribunal was entitled to find that the drivers were committing to accept assignments when they logged on. Drawing similarities with Pimlico Plumbers Ltd and anor v Smith, which involved the regular offer and acceptance of work, the EAT held that this underlined that the Addison Lee drivers had worker status. It found that, although the drivers had autonomy over when and where they logged on to work, to conclude that either party had no obligation it was unrealistic.

In the EAT’s view, Addison Lee’s commitment to training drivers and encouraging them to the hire of a vehicle, as well as conducting HR checks demonstrated an intention to give drivers a fair opportunity to work.

Therefore, the EAT concluded that the tribunal was within its rights to take a ‘realistic and worldly wise’ approach and find that obligations existed.

This case demonstrates a further ‘nail in the coffin’ for businesses seeking to engage workers and avoid obligations such as holiday pay and the national minimum wage.