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To be employed or self-employed, that is the question

Two drivers from well-known online cab service Uber have taken the company to a London Employment Tribunal over claims that the firm is acting unlawfully by not offering holiday and sick pay to its drivers

This important test case hinges on whether the drivers are considered workers or if they are self-employed as Uber claims – two different classifications of employment that are subject to different rules and rights.

Under UK employment law, workers receive similar rights to employees in that they are entitled to holiday pay, are protected from unlawful deductions from their pay, receive minimum national wage and may be entitled to sick pay.

These same rights are not afforded to self-employed contractors, who benefit from a more flexible work arrangement.

Uber maintains that all of its drivers are classified as self-employed and this case may challenge whether they are correct.

The outcome of this case will determine the likelihood of another 17 claims being brought against the company from drivers waiting in the wings. Moreover, it may set a precedent for additional cases to be brought against other employers who use self-employed people within their operations.

Fast food courier service Deliveroo has already reacted to the case by implementing a number of changes to its employment contract to avoid similar cases being brought against them.

According to recent reports, a ‘safety clause’ penned for Deliveroo’s standard contract states: "You further warrant that neither you nor anyone acting on your behalf will present any claim in the Employment Tribunal or any Civil Court in which it is contended that you are either an employee or a worker."

Furthermore, should a Deliveroo contractor challenge the clause, “a staff member will be contractually obliged to pay Deliveroo’s legal fees,” Business Insider has reported.

However, members of the legal profession have argued that this would be unenforceable as the court does not look favourably on clauses that seek to prevent access to justice.

Government outlines online court plans

An important report on the future of the UK’s Civil Court System has recommended a new online court for dealing with all monetary claims up to £25,000.

The proposals are aimed at helping people to use the courts with ‘minimum assistance’ from lawyers, with the help of user-friendly rules.

The review of the Civil Court System by Lord Justice Briggs said the online court would eventually become the compulsory forum for resolving cases within its jurisdiction.

The three-stage process will involve an automated triage system to decide on the merits of a case, arbitration handled by an assigned case officer and a judicial decision if the case cannot be resolved any other way.

In response to criticism from lawyers, Lord Justice Briggs said that law firms would have to meet the challenges posed by the new system and find a way to provide advice at a fixed recoverable cost.

“If they are all substantially implemented, then the essentially high quality of the civil justice service provided by the courts of England and Wales will be greatly extended to a silent community to whom it is currently largely inaccessible, and both restored and protected against the weaknesses and threats which currently affect it,” said Briggs.

The review is designed to coincide with a programme for reform of the courts by HM Court and Tribunals Service, which will involve significant modernisation of system.

Lord Justice Briggs’ review recommends that case officers should be made up from a senior body of court lawyers and other officials who could assist with functions currently carried out by judges, such as paperwork and uncontentious matters.

The case officers would be trained and supervised by judges, and their decisions subject to reconsideration by judges following a request from the parties involved.

The judge criticised claims that the justice offered by the online court would be a form of online dispute resolution.

In response to the report the Lord Chief Justice, Lord Thomas of Cwmgiedd, said: “Lord Justice Briggs has delivered a detailed and innovative final report, which the senior judiciary – working with the government and HM Courts and Tribunal Service – will now consider with care.”

While it is not yet clear whether online courts will go ahead in this format, many solicitors are arguing that having the right advice at hand is key, even with the new system. Its simpler approach will not necessarily negate the need for professional legal advice.

LINK: Civil Courts Structure Review: Final Report

Tighter lending restrictions hit buy-to-let

The future of the buy-to-let market may be affected by new lending restrictions under proposals from the Bank of England, which says it is watching the sector very closely.

According to research by Property Partner, landlords may require a deposit of at least 40 per cent in order to purchase property in certain parts of England, including Cambridge, Worcester and Chichester, if proposals for new lending criteria go ahead.

Proposals from the Bank of England’s Prudential Regulation Authority also include ‘stress tests’, to determine whether investors could afford their mortgage repayments if interest rates increased.

The Property Partner study shows out of 85 towns and cities in the UK, up to 59 could become more ‘inaccessible’ to buy-to-let investors if the new restrictions are imposed.

Earlier this year, the buy-to-let sector was hit hard, after the former Chancellor George Osborne introduced an additional three per cent stamp duty surcharge on purchases of second homes.

Concerned investors with plans to expand their property portfolios are advised to act fast, before any changes to lending criteria can be implemented by the Bank.

Son-in-law wins the right to challenge mother-in-law’s Will

A landmark ruling from the Court of Appeal in the case of Randall v Randall has set the precedent for a divorced husband to challenge the validity of his former mother-in-law’s Will.

In 2006 Colin Randall and Hilary Randall divorced and they agreed under a consent order that if she inherited more than £100,000 from her mother she would keep up to £100,000, with the remainder of the estate split equally between them. Both parties accepted that this agreement could not bind Hilary Randall’s mother to any particular testamentary disposition.

Following the mother’s death, it was revealed that she had left exactly £100,000 to her daughter and a further £150,000 to the couple’s children.

The husband challenged the validity of the Will, alleging that it had not been validly executed in accordance with section 9 of the Wills Act 1937.

However, the wife’s legal team argued that the only people who could assert a right to administer the estate were those entitled to bring a contentious probate claim. As Mr Randall was not named as an executor under the Will, he was therefore not entitled to a share in the estate, and was also not a creditor of the estate, so did not have sufficient interest to bring the claim.   

His challenge was therefore rejected on these grounds and he sought to challenge the decision at the Court of Appeal.

The appeal was allowed and the Master of the Rolls, Lord Dyson, ruled that “justice in the general sense requires the husband to bring a probate claim to set aside the Will”. He added that if Mr Randall did not have an interest in the estate there was no other route by which he could challenge the validity of his late mother-in-law’s Will.

“If this claim did not fall within the probate jurisdiction, but instead fell within the general jurisdiction of the court, it is obvious that Mr Randall would have a sufficient interest in the subject matter of this litigation to bring the claim. He has a real interest in challenging the validity of the Will,” said Lord Dyson.

His colleague Lord Justice McCombe agreed. He said: “It appears to me to be highly unjust that if, in circumstances similar to the present, a Will had been forged in an attempt to defeat an order made in divorce proceedings, the party affected could not challenge the validity of the Will in probate proceedings.”

All three Lord Justices were in agreement that Mr Randall had the right to bring a probate claim to set aside the Will. This has set a new precedent that may allow those with ‘sufficient interest’ in an estate to bring a claim to challenge a Will that might ordinarily have been refused.

Link: Randall v Randall [2016] EWCA Civ 494 

Tenants’ Human Rights not impinged by possession order

An assured shorthold tenant who opposed a possession order arguing that it impinged her right to respect for her home under article 8 of the European Convention on Human Rights (ECHR) has had her appeal rejected unanimously by the Supreme Court.

The parents of the tenant, Fiona McDonald, had taken out a mortgage on the property in question but fell into arrears following financial problems with their business. The parents then appointed the receivers who served the possession order on Ms McDonald.

Ms McDonald argued that courts considering possession orders made by private sector landlords should consider whether the eviction of the occupier is proportional under the provisions of section 6 of the Human Rights Act 1998 and article 8 of the ECHR. She also asked the court to consider whether section 21(4) of the Housing Act 1988, which provides for possession orders, could be reinterpreted as providing for an assessment of proportionality in such circumstances.

The Supreme Court rejected the tenant’s arguments and found that she was not able to invoke the provisions of either the Human Rights Act or the ECHR to vary the order that had been contractually agreed.

The tenant’s arguments concerning the Housing Act 1988 were also refused on the basis that Parliament had decided how to weigh the rights of tenants and landlords against each other.

Link: Supreme Court rejects claim that possession order infringed tenant’s human rights

Privacy and injunction cases double

Privacy and injunction cases brought before the courts in England and Wales have doubled over the last five years.

The rate at which privacy cases are coming before judges has accelerated to one per week. A fifth of these cases involve celebrities or politicians.

The editor of European Human Rights Law Review, Jonathan Cooper, said: “The debate over the use of privacy injunctions has reignited after a number of years in which their usage had tailed off.

“The media has expressed concerns that it is too easy for public figures to use this tool to control what was being published about their private lives.”

Research by Thompson Reuters Legal Business showed a sharp increase in the number of privacy cases from 28 in 2009-10 to 58 in 2014-15.

A spokesman for the firm said: “The number of reported court cases involving privacy arguments has reached a new high.

“Approximately a fifth of reported cases using privacy arguments in the last year involved celebrities and politicians.”

“Another key issue in many privacy cases is the extent to which individuals have a right to determine what happens to information after they have provided it to a company or a public sector body.”

Link: Court cases involving privacy ‘double in five years’

Here to guide you through uncertain times

As the UK begins the process of leaving the EU – regardless how they voted – many will be wondering what the future holds.

The future for the post-Brexit UK will very much depend on how the negotiations around the UK’s exit from the EU proceed in the coming months and years.

A post-Brexit UK retaining strong ties with the EU, perhaps resembling Norway, would look very different from a post-Brexit UK with weaker ties to the EU.

Most likely for businesses, however, the devil will be in the detail; which elements of EU law will no longer apply? How will businesses be able to change their procedures to take advantage of any reduction in red tape? How will EU laws the UK wishes to retain be enacted into domestic legislation? How will cross-border disputes be dealt with? Will the UK retain any relationship with the European Court of Justice as a consequence of any free-trade agreement? What legal requirements will there be around trade with EU member states?

While the answers to these and the many other questions around Brexit are being determined, we will be working pro-actively on behalf of clients to help plan for any changes in legislation or legal requirements to minimise any disruption to your business.

If you have any questions around how the negotiations will affect you and your business, please contact us.

Acas Conciliation has helped to prevent seven out of ten potential court hearings, according to new research

Acas has published a new independent study that shows how its revitalised conciliation service has managed to reduce the number of employment tribunal hearings conducted in the UK.

The figures are partly a result of changes to the law in 2014, which meant that anyone considering launching an Employment Tribunal claim has to notify Acas first.

It is then Acas’ responsibility to attempt to resolve the dispute, without the need for legal action to be taken, through the use of its own free conciliation service. This option remains open even after a tribunal claim has been lodged.

The independent research showed that approximately seven out of ten (71 per cent) claimants avoided going to court after receiving assistance from Acas and in eight out of ten cases that under-go conciliation users feel satisfied with the process.

Importantly for the future of the service, 92 per cent of employers said they would use the service again, while 87 per cent of claimants would also re-use the same conciliation system.

Acas Chair Sir Brendan Barber said: “Our advice is that it is always better to try and resolve a workplace dispute at the earliest possible stage. But anybody who finds themselves in a position where they are considering legal action should definitely consider our free conciliation service first.

“New independent research shows that seven out of ten potential employment tribunals have been resolved or avoided thanks to our help.

“These encouraging findings, alongside the high levels of satisfaction from both employers and individuals who have used our service, are a testament to the professionalism and expertise of our conciliation staff.”

Link: Acas research

Single parents deserve same surrogacy rights as couples, says the President of the High Court Family Division

A formal declaration has been made by Sir James Munby, President of the High Court Family Division, which state that UK law discriminates against single parents with children born through surrogacy and is incompatible with their human rights.

His declaration comes in light of Re Z (A Child) (No 2) [2016] EWHC 1191 (Fam), which concerns a British biological father of a 21-month-old boy known as ‘Z’, who was born through a US surrogacy arrangement and lives with his single father in the UK.

In September 2015 the high court ruled that it was not possible to grant a UK parental order to the father of Z – an order required to extinguish the responsibilities of the surrogate and to issue a UK birth certificate for Z – as under UK surrogacy law only couples could apply; not single parents.

Subsequently the court found that the US surrogate who carried Z and who continues to live in the USA has sole decision making rights in the UK despite not being his biological mother and having no legal status there. Following this decision Z was made a ward of the court.

However upon review of the case Lord Munby has now declared that the law is incompatible with the father’s and the child’s human rights, and discriminates against them.

In a rare move that the Secretary of State for Health decided not to oppose the father’s application, conceding that UK law breached human rights legislation and consenting to the court making a declaration of incompatibility.

Declarations of incompatibility under the Human Rights Act are rare only 20 final declarations have ever been made, of which all but one has prompted the law being changed. The government has not yet confirmed whether it plans to push forward reform in this area.

Responding to the judgment, Z’s father said: “I am delighted by today’s ruling which finally confirms that the law is discriminatory against both my family and others in the same situation. I persevered with the legal action because I strongly felt that my son should be in the same legal position as others born through surrogacy.

“I have a son whom I love dearly and as part of this process there was a rigorous court assessment that confirms that I am a good parent. I am now eagerly waiting to hear what the government will do so my son does not need to indefinitely remain a ward of court.”

Link: Re Z (A Child) (No 2) [2016] EWHC 1191 (Fam)

Government lays out new proposals for compulsory purchase of land

As part of the new Neighbourhood Planning and Infrastructure Bill announced in the Queen’s Speech, new proposals have been introduced which will seek to redress issues faced by landowners undergoing a Compulsory Purchase Order (CPO).

The aim of the new bill is to support the government’s ambition to deliver one million new homes, while protecting valued areas (such as Green Belt); ensure the homes and infrastructure the country requires are forthcoming; and radically alter the way that major infrastructure projects are planned for and delivered. 

As part of these changes, it will seek to make the CPO process clearer, fairer and faster for both developers and land owners alike.

The changes will include reforming the context within which compensation is negotiated. This is often a significant part of any CPO and often creates a number of complexities when attempting to close a deal.  

The move comes after the government announced plans to consolidate and clarify over 100 years of conflicting statute and case law.

As part of this process the government will establish a new clear legislative framework to assist compensation negotiation. While further details are yet to emerge the government has made it clear that this new system will be based upon the fundamental principle that compensation should be based on the market value of the land, in the absence of the scheme underlying the compulsory purchase.

The Queen’s Speech also included proposals to effectively privatise the Land Registry, which experts claim will support the delivery of a modern, digitally based land registration service.

However, the Conveyancing Association (CA), the leading trade body for the conveyancing industry, has said it is against the privatisation of the Registry.

Eddie Goldsmith, Chairman of the CA, said: “It was very clear from last month’s Management Committee Meeting that, while the vote was not unanimous, a majority of management committee members opposed any privatisation of the Land Registry. Within our consultation response we have therefore set out the reasons for this opposition and we would urge individual CA member firms to issue their own responses, in order that we reflect both a collective view and also to ensure those with a different opinion have their voices heard.

“We are however not so naive as to think that this will mean privatisation is stopped in its tracks. It’s clear that it is the government’s favoured option and therefore it may go ahead regardless of our views.

“This is why, within our consultation response, we have suggested a number of safeguards that we would like to see in place, as well as recommendations about how a newly-privatised Land Registry should be managed, overseen and ultimately deliver its services.

“We await the results of the consultation and will be taking a full part in any future proposals that The Department for Business, Innovation & Skills issues on this incredibly important matter.”

Link: Queen’s Speech 2016