‘Worker’ Status and Holiday Pay

Monday 4 May 2020

In the recent case of B v Yodel Delivery Network Ltd, the European Court of Justice (ECJ) gave guidance on how to determine whether an individual was a ‘worker’ for the purpose of the EU Working Time Directive and the UK Working Time Regulations 1998.

In this case a delivery driver, working for Yodel, made a claim for holiday pay. His contract specified that he was an independent contractor and provided him with a right to appoint a substitute with no limitations, except that the substitute must be suitably qualified.

The driver could set a limit on the number of parcels that he would deliver, had flexibility about when to deliver them (unless a customer had requested a particular time slot), and could work for a competitor without restrictions.

The ECJ found that, in this case, the delivery driver did not have ‘worker’ status and, therefore, he was not entitled to receive holiday pay. The ECJ’s rationale for this was that: the driver appeared to be working independently; and there did not seem to be a relationship of subordination between him and Yodel.

To decide whether the driver should be categorised as a worker the Court considered:

• The existence of a contractual power of substitution;
• The driver’s ability to decide whether or not to accept work;
• The driver’s ability to work for others (including competitors); and
• The driver’s ability to fix his own hours of work, albeit within parameters set by Yodel.

It is important to remember that the ECJ not only looked at what the contract said but also at the day to day practicalities of the delivery driver’s role.

It is, therefore, crucial to ensure not only that any contract clearly sets out the obligations and expectations between the employer and the individual but also that these obligations and expectations are reflected in their day to day practices to avoid any difficulties associated with employment status.

If you have any questions on worker status, please email or call our Employment Law team today on 0113 207 0000.