What is gig work?
Gig work refers to fixed-term tasks outsourced by businesses or individuals to gig workers with the help of digital platform firms (e.g., Uber, Deliveroo). Gig workers have always been considered independent contractors in the past.
The classification of gig workers is a global debate. Companies often label them as “independent contractors,” while labor advocates push for “employee” status, entitling workers to benefits like overtime pay, sick leave, healthcare, and bargaining rights.
An employee is an individual engaged in work for an employer under an employment contract or agreement. Employees typically work under the direction and control of the employer, and in return, they are entitled to various rights and benefits. These rights often include job security, protection against unfair dismissal, paid time off (such as holidays and sick leave), overtime pay, and access to employee benefits like health insurance, pensions, and sometimes collective bargaining rights.
An independent contractor, often associated with gig or freelance work, is an individual who operates as a self-employed contractor. Independent workers have greater autonomy over their work, often working on a project-by-project basis or providing services to multiple clients. While they enjoy flexibility, they may not have the same level of job security as employees. Independent workers are responsible for managing their taxes, insurance, and other business-related aspects. They typically do not receive traditional employee benefits, such as paid leave or employer healthcare, and may not have the same legal protections against unfair dismissal.
Bogus self-employment refers to a situation in which a worker is classified as an independent contractor, but in reality, their work arrangement more closely resembles that of an employee. This classification is often used by employers to avoid certain legal obligations and responsibilities associated with traditional employment, such as providing benefits, paying taxes, and adhering to labor regulations.
In a bogus self-employment scenario, the worker may lack the autonomy and independence typically associated with genuine self-employment. They might work under close supervision, have set working hours, use company equipment, and perform tasks that are crucial for the employer’s business to run smoothly. Despite these characteristics, the employer designates them as a self-employed contractor, potentially leading to the denial of employment rights and benefits that employees would typically receive.
Recent Supreme Court case
A recent Supreme Court ruling on Domino’s drivers could empower numerous workers to claim employment rights. Workers entered into an “umbrella” agreement under which drivers committed to confirm their availability for work one week in advance and they would then be rostered accordingly. Due to this, the Supreme Court says that individuals delivering for the pizza restaurant should be classified as employees rather than independent contractors, the decision carries significant consequences for workers within the gig economy.
Many workers who are currently labeled as self-employed may soon be able to seek compensation for various benefits such as holiday pay, sick pay, bank holiday premiums, and pensions. These potential claims could be addressed at the WRC in the coming months.