With interesting timing, the Watford Employment Tribunal (ET) has referred a number of questions to the Court of Justice of the European Union (CJEU). The ET has asked the CJEU to clarify whether, where there is a contractual right to substitute, an individual can properly be classed as a "worker".

The case concerns an individual engaged by Yodel as a courier under a "courier services agreement".  This agreement expressly states that the individual is a self-employed independent contractor and is neither an employee nor a worker. The agreement expressly permits the courier to engage a subcontractor or "substitute" to perform all or any part of the services.

The ET has suggested that the way worker status is determined under UK law might be incompatible with how it is viewed under EU legislation. It has asked the CJEU whether the fact that an individual has the right to engage substitutes to perform all or part of their work means the required element of personal service is not present for the individual to be considered a "worker" for the purposes of the Working Time Regulations 1998.

But Brexit?

The case has been referred in time – before the leave date of 31 October 2019. But what happens if there is a no-deal Brexit?

CJEU decisions will not be binding on the UK courts post a no-deal exit. For cases that are pending, such as this, it is likely that the CJEU would no longer have the jurisdiction conferred on it by the Treaty of the European Union (TFEU). Therefore, there is the possibility that this referral will simply fall away and we will never know the CJEU's view.

If there is an orderly Brexit based on the withdrawal agreement negotiated by Theresa May (or a revised agreement is reached by Boris Johnson), then it should make provision for what is to happen to cases pending at the end of the transition period.

In summary

The classification of "worker" in the gig economy is still a hot topic that is unlikely to go away any time soon. Coupled with the extension of the IR35 tax rules, it is vital that companies classify workers correctly. The outcome of a deal/no-deal Brexit and what this means for UK employment law remains to be seen.  However, it is likely that any decisions in relation to other member states post-Brexit would be persuasive in the UK courts for as long as the relevant UK legislation continues to derive from EU law.

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.