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4th August 2005, Page 38
4th August 2005
Page 38
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rights stuff 1LF--7

Mat is the status of an owner-drivers' contract with his employer? A recent dispute highlights this grey area of law. David Craik reports.

At the end of June, 30 owner-drivers working out of the West Drayton depot of Bardon Aggregates say they were dismissed after going out on strike in support of one of their colleagues (CM 14 July). They claim a fellow owner-driver had been fired for alleged violence during a previous strike (CM 30 June).

One owner-driver,Charanjit Singh, known as Freddie, explained to CMat the time that many of the owner-drivers had been working out of the depot for between 15 and 25 years. "We were told to get our vehicles out of the depot in a matter of days," he added.

The exasperated driver wrote to his union, the RMT, asking for its help. As CM went to press the union and management at Bardon were meeting to discuss the situation. However, as union representative Sally Jenkins explains, the owner-drivers' contractual status with Bardon is complicating attempts to find a resolution.

-We asked the drivers what contracts they had with Bardon," she says. "However, they were not very sure. We have obtained a copy of the terms and conditions of their contracts and our solicitor is presently looking at them."

When CM spoke to Freddie he reported that the owner-drivers "used to have a contract to distribute for Bardon" but that after it had run out "we continued on a contract of mutual understanding. We are permanent hauliers at the site."

Management at Bardon has been unavailable for comment to CM on this issue but Jenkins states that the company has told the RMT that they -do not consider the owner-drivers as employees of Bardon".

However, she adds: "We have already found that the company sets the rates and tells the owner-drivers which destinations to go to.'This is a fine point. We are not sure about their current status and we will look into what we can do for them.

Employees or self-employed?

The situation at Bardon raises some important questions on the contractual status of ownerdrivers; particularly whether they are deemed to be employees or self-employed.

Andrew Woolfall, a solicitor at Lancashire law firm Back house Jones, believes the Road Transport Directive has made this a pertinent issue for owner-drivers and large hauliers or the firms which use them. It is a particularly complicated area of the law.

"Owner-drivers have got to be very careful," he says."If you work exclusively for a client, say an aggregates company and no-one else, then from what we can see from the guidance on the Working Time Regulations, you risk being classed as a worker. You will then be beholden to the regulations." For example, such a driver will be unable to take advantage of the current opt-out enjoyed by owner-drivers.

Worker',`employee' and 'self employed' are three different categories. A 'worker' is someone who is not an employee but who has agreed in a contract to personally perform services for a company.

You are 'self-employed' if you are in business on your own account and bear responsibility for your business's success or failure. "The definition of an employee is of someone who gives a personal service and has a mutuality of obligation.Their employers will look after their tax and national insurance," says Joanna Cowie, a solicitor with Barker Gotelee.

Cowie says these different definitions make this "a really difficult area" but agrees with Woolfall that it is becoming "increasingly relevant at the moment because of the Working Time Regulations which is asking the question 'who is or isn't self employed?" Both solicitors say most operators claim not to want the owner-drivers they use to be classified as employees. "It isn't surprising that a company such as Bardon would want ownerdrivers hauling for them to do so on a selfemployed basis," says Woolfall.

"The drivers can then work over 48 hours and the company does not have the hassle of financing vehicles. The drivers can also down sticks and say that they want to work for Joe Bloggs down the road instead. You have to decide which camp you want to be in.There are benefits and downsides to both."

According to the Inland Revenue, whenever an employer takes on a worker it must be considered whether the "terms and conditions you engage them on make them employees or self-employed".

Cowie says that if an owner-driver wants to be defined as self-employed or an employee, or even a worker, he should get some advice before signing a contract.

Employees have rights

As an employee a driver will have rights including holiday pay, sick pay and a right to claim unfair dismissal after the first year of working. As a worker you can be entitled to holiday pay, the minimum wage and the right to be accompanied at disciplinary and grievance procedures. You also fall under the working time regulations. If you are self-employed your employment rights are limited to the terms of your contract, contract law and rights embedded within the Human Rights Act.

Back to the Bardon case. Woolfall explains that the RIVIT will not be able to"use its power" if the drivers are truly self-employed. "However, if there is a breach of their contract then they can leave and sue in a civil court.Theycan 't go to an Employment Tribunal."

However Cowie says that in her experience tribunals can and do look beyond owner-driver/ company contracts which purport to define them as self-employed: "They will consider factors such as: was there holiday pay; was a truck driven with a company livery; was the person subject to company rules and regulations; did they wear a company uniform?

hey can even ask whether somebody was invited to last year's staff Christmas party. If these questions are answered yes then that may smack of an employment contract."

In such a dispute an owner-driver's employment status and his subsequent rights are not within the employers' power to decide. They will be determined solely by the terms and conditions of the contract with each worker. •


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