By Sukhwinder Sahl
UK employment practices and ways of working have undergone a significant shift from the traditional “full time employee” to a rise in the use of freelancers, causal workers, agency workers and zero hour contract workers. In the name of flexibility such working patterns are increasingly being promoted as the new norm within UK businesses. Such working practices have come to be known as the “Gig economy”, which essentially represents a range of workers who lack the protection of fair pay and paid benefits such as holiday or sick pay. The Chartered Institute of Personnel and Development (CIPD) estimate that there are approximately 1.3 million people (4% of all in employment) working in the gig economy in the UK.
Today’s judgment from the ECJ (29th November 2017) has sided with a gig economy worker, using the controversial working time regulations as a means for justifying his position. Unions embrace the ruling as it represents a high degree of protection for worker’s rights, which in the absence of the ECJ may never have materialised. Mr King operated as a window salesman on a self-employed commission only basis for Sash Window Workshop Ltd. His employer’s considered him to be self-employed and therefore not entitled to paid leave, however the ECJ classed him as a worker and using the rules of the WTR, believed he had the right to paid leave. The ECJ has now confirmed that Mr King – a commission-based salesman who did not receive holiday pay for 13 years and took numerous unpaid holidays during this period, was due compensation for his time off. This is a decision that will potentially have a very significant and costly impact for employers operating in a gig economy.
More importantly what this case does demonstrate is the ongoing difficult relationship with respect to the interpretation of the working time regulations. An area of law that the UK government was never keen to support, but an area that continues to generate conflicting case law, which results in putting UK employers in a position of risk and facing the likelihood of future claims. In support of the role of the ECJ, Jason Moyer-Lee, General Secretary of the Independent Workers’ Union of Great Britain (IWGB) pointed out that the ECJ has become a favorite target of Brexiteers, and said “This judgement is a striking reminder of the impending disaster for worker rights that is Brexit,” (Independent, 2017).
As we move forward with negotiations and attempt to understand the precise role of the ECJ, it is clear such rulings will not encourage UK employers to support a continued voice or presence for the ECJ in either a transition arrangement or beyond. However the remain voters may see this decision as a stark reminder of exactly what kind of employment rights could potentially be at risk, and subject to a “bonfire of worker’s rights” (Coulter, & Hancké, 2016). Worker’s rights to unpaid holiday recognised through this ruling will for now need to be followed as the ECJ still operates with binding effect; until we formally leave the EU. Workers operating in a gig economy may welcome this decision and look to pursue claims linked to their employer status, however whether such rulings will prompt the UK government to consider the WTR as an area of law that may benefit from dilution, remains to be seen. Although Theresa May has offered assurances, by pledging to protect worker’s rights after Brexit and transposing them into UK law under the Great Repeal Bill, the future impact of the WTR is likely to be a contender for change. The Prime minister’s key sentiment in her message of re-assurance is that it is “business as usual”, yet, in the past Theresa May has described the social chapter as a sop to the unions and a threat to jobs (Dromey, 2017).
References:
Coulter, S. and Hancké, B. (2016), ‘A bonfire of the regulations, or business as usual? The UK labour market and the political economy of Brexit’, The Political Quarterly, 87 (2): 148-156.
Dromey, D. (2017) “The Brexiteers who hope Article 50 will spark a bonfire of worker’s rights”. New Statesman, 29th March 2017
https://www.cipd.co.uk/knowledge/work/trends/gig-economy-report
Centre for Brexit Studies Blog 