Michael Clifford: UK court rulings give hope to precarious workers – it's time we follow suit

Hundreds of thousands of workers continue to operate in precarious circumstances due to the prevalence of bogus self-employment, writes Michael Clifford

Uber drivers outside the Supreme Court, London, last Friday, after Supreme Court justices ruled against Uber operating companies and concluded that drivers should be classed as workers, not independent third-party contractors. 

There was some recent good news in the world of precarious work, but it came from abroad. 

Time will tell whether decisions handed down by courts in the UK and the Netherlands have any impact on those who are denied proper employment conditions in this country.

Last week, the Supreme Court in the UK issued a ruling on bogus self-employment that has been described as “momentous”. Bogus self-employment is the practice of forcing workers to provide services as a contractor rather than an employee. In such an arrangement, there are no provisions for sick pay, holiday pay or the benefit of employees' rights. There is also a loss to the exchequer through forgone PRSI, estimated in this country to be up to €1bn annually.

A report from the National Economic and Social Council (NESC) last November pointed out that “investigations into certain sectors suggest that up to 25% of workers in some workplaces could be wrongly classified as self-employed”.

Last Friday, the UK Supreme Court issued a ruling on a case taken by a number of drivers from the cab ride firm Uber that they were being treated as self-employed, but to all intents and purposes, were employees.

The company disputed this. Uber’s case relied on the written contract between the company and drivers. The contract stated that once a request for a car was accepted through Uber’s app, a contract was created between driver and customer.

The court ruling rejected this, pointing out that employment legislation was “to give protection to vulnerable individuals who have little or no say over their pay and working conditions because they are in a subordinate and dependant condition.” 

To use the written contract as a starting point in deciding the status of the drivers would be to “reinstate the mischief which the legislation was enacted to prevent.” 

The court ruled in the drivers’ favour.

The victory is being seen in the UK as a push-back against the gig economy of precarious work that has mushroomed since the economic crash in 2008.

Last December, the Supreme Court in the Netherlands handed down a ruling that dealt another blow to bogus self-employment. 

The case at issue concerned a person employed by the municipality of Amsterdam for occupational therapy. Her contract with the city described her as self-employed. 

But the court found that the nature of her work was that of an employee. The court ruled she was entitled to the rights of an employee because “the rights and obligations that the parties had agreed in the placement employment contract did not have the characteristics of an employment contract”. 

Meanwhile, at home, there are distant rumblings of change. Last week on these pages, Cianan Brennan reported that the Revenue has acknowledged that all couriers are deemed to be self-employed as a result of a single precedent dating from the mid 1990s. This may well thrust a cat among the proverbial pigeons in the area of bogus self-employment.

Couriers are typical of the kind of workers who are classified as self-employed but, in many instances, work as if an employee. Over the years, a number of couriers have attempted to have their status reclassified.

But there appears to be a reluctance in the State apparatus to accommodate them, and others of a similar status working in areas like construction.

Activist Martin McMahon, who has written a book about this area, believes there is a major lack of political will to properly tackle bogus self-employment. 

A lot of politicians believe the practice keeps down live register numbers and they are always being lobbied by some employer groups to stay away from it.” 

The Revenue missive to the Oireachtas Public Accounts Committee about couriers last week raises a major question about why certain groups are classified as self-employed, irrespective of the specifics of their work.

Revenue chair Niall Cody actually denied that any test case was used to determine whether couriers were self employed, but went on to say: “However, couriers were regarded as self-employed for PRSI purposes as a result of a Social Welfare Appeals Officer’s decision. In the interest of uniformity, Revenue decided, without prejudice, to treat those couriers as self-employed for tax purposes.” 

If this applies across the board, then couriers have no prospect of achieving employment status, and must continue to work in precarious conditions. They are just one example of the hundreds of thousands of workers in some sectors who are forced to exist in precarious conditions of employment.

The PAC has served notice that it intends to pursue this matter. Committee chair Brian Stanley has indicated he would like to see Mr McMahon appear before the PAC when the subject comes up next month. Change, if it is afoot, will come dropping slowly.