Taxi giant Addison Lee wrongly classified its drivers as self-employed and must pay them the minimum wage and holiday pay, an employment tribunal has ruled.
Unite hailed the case, which was supported by the GMB union, and called for stricter legislation to reign in bogus self-employment.
A ruling on Deliveroo’s use of self-employment is currently being considered, while cases involving Hermes and DX will be heard next year.
The ruling against Addison Lee will affect thousands of the company’s drivers, who are now entitled to full workers’ rights and protections, said Leigh Day, the legal firm that represented the workers.
Leigh Day spokeswoman Liana Wood said, “Addison Lee advertises itself as a premium driving service and seeks to ensure that its drivers meet the high standard required for that premium service.
“However, Addison Lee drivers very often work very long hours, in excess of 60 hours a week, in order to just earn enough to cover their basic living costs.
“Addison Lee has sought to deny its drivers the most basic workers’ rights, including to be paid the national minimum wage and to receive paid holiday.”
Leigh Day estimates the holiday pay owed to each of the three Addison Lee drivers who brought the case could reach £4,000, with back pay yet to be calculated. The firm, which raked in £61m profit last year, has 3,800 self-employed drivers in London, all of whom could be affected by the ruling.
Unite assistant general secretary Steve Turner lauded the victory but said more needs to be done to end bogus self-employment.
“Bogus self-employment is a scourge and once again the justice system has seen through an employer’s attempts to deny their staff workers’ rights,” he said.
“While the court’s ruling against Addison Lee is a success, there are hundreds of thousands of workers in sectors such as logistics and construction who are still being exploited through bogus self-employment.
“It’s clear that the Tories are not interested in making the reforms – such as barring sham umbrella companies, shifting the burden of proof that a worker is self-employed onto employers, introducing sectoral collective bargaining and strengthening trade unions – necessary to end fake self-employment.”
He added, “Trade unions, including Unite, will always fight against bogus self-employment but the only way we will see widespread justice for those forced into working under such conditions is through the election of a Labour government.”