This app has won attention for revolutionising the taxi business worldwide, but it is now subject to legal action from Uber drivers who claim to be entitled to worker’s rights. This union led action highlights that it can sometimes be difficult to correctly categorise a member of staff as an employee, worker or self-employed. Are you getting it right?

The basis for the Uber claim is that the drivers do not have the same degree of autonomy that a self-employed person would because Uber takes payment from passengers, decides charging rates and controls the routes taken. The drivers are paid by Uber and cannot choose to send in a substitute driver if they’re not available to work for any reason.

We have seen similar confusion in the past in relation to unpaid intern with high profile companies being caught out. For example, an intern who worked for Sony without pay (other than expenses) claimed that he should have been treated as a worker and received the national minimum wage and settled out of court for almost £5,000.

The factors for deciding whether someone is an employee are perhaps better understood, but deciding whether someone is a worker (and therefore entitled to national minimum wage and other worker’s rights such as holiday) is harder. You need to consider issues like:

Does the individual have to give you personal service, or can they send in a substitute if they are not available for any reason?

Can the individual refuse work if they’re not available for any reason?

Is the individual closely managed/supervised? Are they subject to a high level of control or do they have autonomy over how they carry out their tasks?

Is the individual required to work fixed hours or a minimum number of hours?

Is the individual adding a benefit to your business? An intern or work experience person will usually shadow your staff and watch what they’re doing, or perhaps carry out simulated work tasks. If they’re undertaking work that would benefit your business then arguably they should be getting paid for this.

Over the last couple of years, HMRC has carried out greater numbers of investigations into failures to pay national minimum wage and so it is important to make sure that you are correctly categorising your staff. If in doubt, let me know and I can review it with you to make sure you’re not at risk.

Kate can be contacted at katebooth@eatonsmith.co.uk or on 01484 821 309.