Employment status – a change in contractual terms did not change worker status

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The case of Mr S O’Eachtiarna and others v City Sprint (UK) Ltd followed a decision in 2017 that found that a CitySprint cycle courier was a worker rather than a self-employed courier, and was therefore entitled to paid holiday. The Employment Tribunal’s 2017 decision found that the “Confirmation of Tender” document between CitySprint and the claimant courier, Ms Dewhurst, did not reflect the parties’ true relationship. The Tribunal looked at facts, including that CitySprint required Ms Dewhurst to log into its tracking system (Citytracker) when she was on circuit, and log out at the end of the day. The Tribunal found that Ms Dewhurst was a worker when logged into Citytracker.

CitySprint lodged an appeal against the 2017 decision but withdrew it after all its cycle couriers agreed to a new tender document, effective from 12 November 2017.

Further claims by a group of couriers against CitySprint followed which argued that they were workers and therefore owed holiday pay. CitySprint argue that these claims were defeated from 12 November 2017 onwards, in consequence of the new contracts.

On the ground nothing had changed before and after the new contracts, and that CitySprint conceded that they were workers before the new contracts, the couriers argued that they were also workers after them. This argument was rejected by Judge Andrews, who found that this simplistic approach “overlooks the central importance of the contractual position underpinning the relationship between the parties in the statutory definition of worker”.

The new contractual terms, which were written in clear and plain English reflecting reality in most respects, contained a right for the couriers to appoint a substitute. However, this was found to be theoretical only, and the couriers had never used it. Judge Andrews followed Pimlico Plumbers Ltd v Smith [2018] and assessed whether the dominant feature of the contract remained personal performance. On the facts, it did.

CitySprint was also found not to be a client or customer of the claimants’ profession or undertaking. None of the five lead cases provided services to another professional courier business as cycle couriers, and there was no evidence of them marketing such services.

The claimants were therefore found to be workers when working on the circuit, even after they entered into the new contracts.

As for holiday pay, the new contracts stated that if couriers ever became entitled to holiday pay, their fees would be deemed to include holiday pay at the minimum statutory rate. This clause was not found to be a valid ‘rolled up’ holiday pay clause.

A remedies hearing will follow to determine what is to be paid to the claimants.