Worker status and mutuality of obligation

13 July 2018

Does 'mutuality of obligation' exist when someone is entirely free to choose when they work?

The Employment Appeal Tribunal has looked at whether 'mutuality of obligation' can exist when someone is entirely free to choose when they work. Mutuality of obligation is where the employer must offer work and the individual must accept it. Some mutuality of obligation is required for both employee and worker status.

Mr Gascoigne was a cycle courier with Addison Lee. He wore a non-compulsory branded t-shirt and bag. He also carried company ID, radio, palmtop computer with an app and a GPS tracker. The company provided insurance but Mr Gascoigne reimbursed them. He used his own bike and paid his own tax and NI. He could choose when he worked. However, when he was logged into the company app, he was deemed available and ready for work. He was expected to do jobs he was given. He could only refuse a job in exceptional circumstances, for example if the parcel was too heavy.

Mr Gascoigne brought a claim as a 'worker' for holiday pay under the Working Time Regulations. The company said Mr Gascoigne was not a worker because there was no mutuality of obligation. The tribunal disagreed. The company exerted significant control over Mr Gascoigne. He had to personally perform the work and he was not running his own business. On the mutuality of obligation point, when Mr Gascoigne was logged onto the app, he had to accept jobs. That was sufficient mutuality of obligation for worker status. The fact that he could log off when he wanted was irrelevant.

The company appealed but the EAT upheld the tribunal's decision. Mr Gascoigne was a worker and entitled to holiday pay.

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