In May 2008 we reported on the Court of Appeal case of James v Greenwich. This case set the tone thereafter as the Appeal Court clarified in summary that agency workers will not normally be regarded as implied employees of the hirer unless they work in a way not reflected in the worker’s agreement with the agency. Both hirers and agencies have relied on this case ever since.
Nothing has really changed for 15 years. However into this scene comes a claim by multiple drivers against Amazon and its supplier companies.
Think of Amazon as the hirer, and the outsource company providing the drivers as agencies. Whether the outsource companies are genuinely providing a service other than supply of workers or actually employment businesses supplying workers to Amazon will be a question to be answered; they certainly could be if that is how their businesses are shaped in reality. If they are, the individuals will likely be agency workers entitled to worker rights and the ‘agencies’ liable to treat each as deemed employees for tax purposes.
However the publicity is all about the drivers suing Amazon for worker or employee rights. The James case is an obstacle they will need to address. Is there a need to look behind the contracts on the basis that they do not reflect what is intended and agreed? Whilst the contract between Amazon and its supplier may be partially a sham in that it is actually a supply contract in everything but name, is this enough to justify a full review?
The denial that the individuals actually work for Amazon looks as if it can be challenged by the degree of control Amazon had over the individual’s work. Who was directing the drivers, where they should go to pick up and deliver goods, how long they should take to get to or stay at a destination? Given it is understood that the drivers had to follow instructions on an Amazon app it is hard to argue that control is exercised by anyone other
than Amazon. But so what? The supplier companies appear to be acting no differently from an employment business in a typical supply situation where the hirer exercises direction and control. There may be an exception to the norm as presumably the suppliers take responsibility for all the drivers’ actions, but arguably legal responsibility is a commercial issue not an employment one.
Control is the issue, and where the control is for all intents and purposes at the behest of Amazon, Amazon is likely to be seen as the boss responsible for the rights. That is, except for James v Greenwich which directs the court to consider whether there is a need to look behind the contracts, and if not, the contracts and relationships stand as they are.
It is arguable that there is no such need. The contracts seemingly reflect what was intended. Even the drivers knew what terms they were signing up to. Since the James case may defeat the claim against Amazon it appears that it could be the outsource companies who should provide the drivers with worker rights and those under the Agency Workers Regulations. All would be well if the rights had been provided from the outset.
Regardless of lawyers love for debating Uber et al, and these kinds of cases will continue to emerge wherever rights are denied, on the bare information available at this stage, and on basic principles, the outcome of this case is likely to be drivers succeeding against their immediate employers, namely the outsource supplier or ‘agency’ companies.
Amazon may well win, but which business in its right mind will agree to service Amazon on the same basis going forwards? Use of Amazon as an attention seeking tool will have achieved the objective.
Adrian Marlowe, Managing Director, Lawspeed
Lawspeed group corporate clients benefit from immediate up to date advice on staff engagement and related regulation; employment status; client, IR35, PAYE and umbrella contract templates; contract review/negotiation; self-employment and CIS contract templates; trade membership and government representation; accreditation services and a state of the art digital contract management platform.
Adrian, a highly experienced lawyer, founded Lawspeed in 1997. He is responsible for developing our extensive portfolio of products and services, including the widely used Lawspeed contract templates. Adrian is an expert on “recruitment law” and specialises in contracts, regulatory compliance, employment status and dispute handling. He is chair of the trade body the Association of Recruitment Consultancies, the only lawyer lead recruitment trade body in the UK. Adrian and his co-director Ravi devised Standards in Recruitment as a vehicle for helping drive up standards and compliance in the industry.
Adrian is our lead in discussions with the government over regulatory evolution. Apart from assisting with client support, Adrian’s primary role is research and development into methods of business delivery, our latest service Proterms being his most recent project. Adrian heads our IR35 lawyers team.