In recent years, employment status in the UK has been a critical topic, particularly for care providers who may engage carers as independent contractors or self-employed. 

The recent UK Employment Tribunal ruling regarding Bolt drivers underlines the risks of classifying individuals as self-employed where control and personal service elements might indicate worker or even employee status. 

Employment status

UK law distinguishes between employees, workers, and self-employed contractors based on various factors. For an individual to be considered an employee, certain elements must typically be present:

1. Personal Service - The individual must perform the work personally, without substitution;
2. Mutuality of Obligation - There should be an obligation for the employer to provide work and for the individual to accept it; and
3. Control - The employer exercises control over how, when, and where the work is completed.

To be a worker these elements must be in place:

• Contract  - There must be a contract and it  can be either express or implied; and 
• Control and Personal Service – As with employees, the employer exercises control over how the work is delivered the worker must deliver the work themselves.

In contrast to employees, mutuality of obligation does not need to exist for the individual to be considered a worker.

To determine employment status, an Employment Tribunal will look beyond contract wording to the reality of the working arrangement, and consider the realities of the working relationship. 

While an employee and worker both have certain protections, they differ in some rights and tax obligations:

• Employees have rights like unfair dismissal protection, redundancy pay, and full holiday entitlements.
• Employees and workers are entitled to minimum wage, paid holidays, and protection against discrimination.

Bandi and Others v Bolt: Key points 

The recent Bolt ruling is part of an ongoing re-evaluation of gig economy employment practices.   Most of our employment legislation was drafted when there was no gig economy and employment relationships were broadly simpler hence the difficulties fitting new practices into old structures.  

Bolt, an app providing taxi services, is a fierce rival of Uber and operates across 19 cities with 100,000 drivers.  As Uber has done before, Bolt argued that their drivers were self-employed contractors and so were not entitled to holiday pay or National Minimum Wage. The drivers took Bolt to tribunal to dispute this arguing that they were workers and hence entitled to all rights and protections afforded to workers. 

The tribunal found that Bolt drivers were workers, not self-employed contractors. The judgment primarily focussed on the fact that Bolt held ‘overwhelming’ control over drivers, including setting fares and requiring drivers to meet specific standards. The tribunal noted that ‘the power lies with Bolt,’ and that Bolt’s contractual arrangement suggesting an agency relationship between the driver and passenger was deemed a ‘fiction’ designed to avoid an employer-employee relationship. Further, drivers were required to work personally, with Bolt imposing restrictions around working hours and access to the app.

As workers, Bolt drivers are now entitled to the National Minimum Wage, holiday pay, and protections against unfair treatment. Compensation for affected drivers could exceed £200 million.

Implications for care providers

This ruling has specific relevance for care providers who classify carers as independent contractors. The following points should be carefully considered:

1. Control over care workers: If a care provider exercises control over carers’ work arrangements, such as setting their hours, dictating work methods and requiring adherence with the pre-designed care plans, an Employment Tribunal could interpret this as worker or employee status.
2. Substitution Clauses: The right of substitution remains critical to establishing a self-employed relationship. To minimise risk, the substitution right would have to be genuinely broad, limited only by necessary qualifications (e.g., DBS checks). Restricting substitution beyond regulatory requirements would suggest an obligation for personal service, aligning the individual more closely with worker or employee status.

Conclusion

The Bolt ruling reinforces the legal requirement to align working arrangements with the reality of day-to-day working arrangements. The outcome calls for greater diligence by care providers - if carers do not have autonomy in how care is delivered, and the right of substitution does not exist or is significantly restricted, this suggests worker status. 

For providers that have self-employed arrangements, they should limit control, foster independence, and ensure substitution clauses allow real autonomy, ultimately supporting a defensible classification and reducing exposure to employment claims.

Employment law in this area is complex and evolving, particularly with recent rulings like Bolt’s. We recommend that businesses seek professional advice to assess employment arrangements and reduce legal risk effectively.