Employment Appeal Tribunal Upholds that Addison Lee drivers are 'workers'

Addison Lee has lost its battle in the high profile legal challenge over workers’ rights  and according to lawyers at Irwin Mitchell, its drivers will now be entitled to receive holiday pay and the national minimum wage, costing the private hire driving company millions.

In Addision Lee Ltd v Lange and ors, the Employment Appeal Tribunal (EAT) has upheld the Employment Tribunal’s (ET) decision that the private hire drivers have worker status.

The Claimants were three private hire drivers working for Addison Lee who had brought claims for holiday pay and national minimum wage which meant that they needed to be considered workers pursuant to s.230(3)(b) of the Employment Right Act 1996 in order to be entitled for workers’ rights.

The private hire drivers and claimants had entered into an agreement to hire liveried cars from a company associated with Addison Lee. The documents described the Claimants as independent contractors, but part of the agreement was that each driver had to log on a portable computer known as an XDA. Once they logged on, work would be allocated to them by the computer and they had to provide reasons if a job was refused. If they did not provide these reasons, sanctions were in place.

The Employment Tribunal (ET)  held that the drivers were workers under s.230(3)(b) of the Employment Rights Act 1996 and accepted the drivers’ argument that there was an overarching agreement providing for mutual obligations to offer and perform work, despite the provisions in the driver contract. The ET further found that the drivers had a realistic expectation of being offered work when they logged onto the computer XDA.

Addison Lee appealed this decision to the Employment Appeal Tribunal (EAT) and argued that each Claimant was not a worker - arguing that the ET had wrongly disapplied parts of the agreement in finding there was an obligation to do some work.

The EAT however disagreed and said that the ET was entitled to find that the drivers, when logged on, were undertaking to accept the driving jobs allocated to them. The EAT held that this was similar to the case of Pimlico Plumbers Ltd and anor V Smith where the regular offer and acceptance of work resulting in the drivers working pretty much continuously, justified the conclusion that they had worker status.

Expert Opinion

“This ruling will not only mean that thousands of Addison Lee drivers will be entitled to receive holiday pay and the national minimum wage, but is another huge step in how the gig economy is regulated and follows on from similar disputes between Uber and Deliveroo and their workers. Due to the rapid growth of the gig economy the law now needs to be aligned with how people are employed. But we have not seen the last of this issue and I am sure the floodgate of workers’ claiming rights is only going to continue.” Shah Qureshi - Partner