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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.