Employment tribunal ruling could be a turning point for gig economy, leading law firm predicts

An Employment Appeal Tribunal ruling that a taxi driver should not qualify as an employee may represent a “turning point” for employment claims in the gig economy, a solicitor has said.

A driver of one of London’s famous black cabs has been told he is not a worker of an app-powered hire service company. As a result, the Employment Appeal Tribunal (EAT) told Hackney Carriage operator Christopher Johnson he cannot bring wage deduction and other employment-related claims against Transopco UK Ltd, the British company behind the Mytaxi app.

Like popular ride-hailing apps such as Uber and Lyft, the Mytaxi app allows passengers to order rides from a smartphone and pay for fares using the app.

However, unlike those competitors, the service was geared solely toward black cabs, a regulated taxi service operating in and around London.
The EAT distinguished the case from the landmark ruling by the UK Supreme Court in February 2021 that found Uber drivers did operate as workers for the tech giant. Unlike that case, the EAT noted that the black cab drivers are individually licensed, whereas Uber “acted as the drivers’ agent.”

Ella Bond, an employment solicitor at Harper James, said the ruling was highly significant.

She said: “This is another interesting twist on the law impacting the gig economy. Whereas, in recent cases the courts have shown a tendency to find in favor of the individuals claiming to have worker status, as with the rulings involving Uber and Pimlico Plumbers, this case bucks that trend.
Commenting on the specifics of this case she said: “It was material here that the operating company of the Mytaxi app was found not to control the way in which the taxi driver operated to any material extent. He was able to carry out the services as, when, and how he wished. He was not obliged to accept any jobs and was free to cancel jobs, within certain parameters. He was also able to have access to passenger information and contact the passengers directly after having provided his services to them via the app. In addition, Mr Johnson was able to continue operating as a self-employed cab driver, whilst also providing journeys via the app. All of these factors considered together caused the EAT in this case to find that Mr Johnson was not a worker, and instead he was in business on his own account.”

“This case serves as an important reminder that each gig arrangement will be closely scrutinized and judged according to its own set of facts and circumstances. However, other companies operating in the gig economy would certainly be wise to look at the facts and adjust their arrangements where possible to give at least the same level of autonomy to their individuals as Mr Johnson had. This would increase their chances of any challenges regarding employment status being determined in the same way.”

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