Urgent changes in the law are needed to provide certainty to workers and employees, the Law Society has said, following another ruling on ‘self-employed contractors’.

In judgment handed down this morning the Employment Appeal Tribunal (EAT) upheld a ruling by the Employment Tribunal that drivers for taxi company Addison Lee are entitled to worker’s rights. The ruling will mean thousands of Addison Lee drivers are legally entitled to receive the national minimum wage and holiday pay. Addison Lee had claimed drivers were self-employed contractors, not employees.

Sue Harris, legal director at union GMB, which brought the case, said: ‘Other employers should take note – GMB will not stop pursuing these exploitative companies on behalf of our members.’

GMB has won similar victories against taxi company Uber and courier company Hermes. Earlier this year, the Supreme Court ruled that a man carrying out work for Pimlico Plumbers met the definition of ‘employment’ status.

Law Society president Christina Blacklaws urged the government to follow through on its commitments to begin consulting on Matthew Taylor’s report on modern employment practices last year in order to clarify the laws.

‘The law has not kept pace with changes in how people are employed and the rapid growth of the gig economy,’ Blacklaws said. She added: ‘Employees and contractors are treated differently when it comes to employment rights and tax responsibilities. This means organisations are incentivised to find loopholes to their benefit, which can be detrimental to the employees.’

Stefan Martin, employment partner at international firm Hogan Lovells, said the decision is indicative of the direction of travel in a number of recent cases brought before the UK courts. ’It is a reminder that, regardless of the legalese used in contractual documentation, the courts will look at the substance of a relationship to determine whether or not a person operating in the gig economy is entitled to workers’ rights,’ he said. 

A spokeperson for Addison Lee said: ’Addison Lee is disappointed with the ruling as we enjoy a positive relationship with the vast majority of our 3,800 driver partners. In common with most of the industry, the majority are self-employed, and with earnings at a record high, over 60% said they were likely or very likely to recommend working for Addison Lee in our most recent driver satisfaction survey.’