Case update

Employment status of Bolt drivers

In Bandi & Others v Bolt, the Employment Tribunal held that a group of Bolt drivers have “worker” status and, therefore, are entitled to certain benefits including paid annual leave and the right to receive at least the National Minimum Wage.

Background

The claimants comprised 10,000 current and former drivers who provided private-hire transport services in the UK in the name of Bolt. However, the case only considered eight sample claimants. Their claim related to Bolt’s failure to pay the National Minimum Wage and to provide paid leave. Both are rights that individuals with “worker” status are entitled to.

Essentially there were two questions for the Employment Tribunal to decide:

(1) What is the employment status of Bolt drivers?

(2) If they are “workers”, during what periods are they ‘working’?

“..."worker"...means an individual who has entered into or works under (or, where the employment has ceased, worked under) -
(a) a contract of employment, or
(b) any other contract, whether express or implied and (if it is express) whether oral and in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual"
(s.230(3), Employment Rights Act 1996)

Findings of the Employment Tribunal

Are Bolt drivers “workers”?

Due to Bolt changing its business model from August 2022, the Employment Tribunal had to consider two separate periods when answering these questions:

  • June 2019 to July 2022 (the “Agency Model”)
  • August 2022 onwards (the “Principal Model”)

The Agency Model

Bolt argued that under the Agency Model it did not run a transportation business itself but acted as an agent for the drivers by providing booking and payment processing services and taking a commission from the drivers in return. Bolt claimed (in the alternative) that if it did have a contractual relationship with the drivers then it was by virtue of being a customer of the drivers and, therefore, the drivers fell outside of the statutory definition of “worker”.

The Employment Tribunal rejected both of Bolt’s arguments regarding the Agency Model on the basis they did not reflect the reality of the relationships. The practical reality was that Bolt ran a transportation business in which the drivers were employed by Bolt as “workers”. The great majority of drivers did not have an understanding of the significance of the concept of agency and so there could not have been a meeting of the minds for such an agency relationship to exist.

The Principal Model

Under the Principal Model, Bolt takes a ‘Fare’ from the passenger at once and pays accrued ‘Journey Fees’ to the driver at a later point, usually on a weekly basis. Whilst Bolt admitted that it ran a transportation business, it denied that it engaged drivers personally. It alleged that its ‘Bolt Link’ scheme, which allows drivers to have other drivers operating under their account, negates an obligation of personal service.

The Employment Tribunal rejected Bolt’s case here too. ‘Bolt Link’ did not actually provide for any right of substitution and so did not negate the driver’s obligation of personal service. It was likely conceived by Bolt for the purpose of protecting Bolt against claims that its drivers have worker status.

When are Bolt drivers “workers”?

It is accepted that, as “workers”, the drivers are ‘working’ from the moment they accept a Bolt trip until its conclusion. The point in dispute was whether drivers were ‘working’ in the time in between trips. The drivers did not allege they were working when using multiple apps and so the dispute did not turn on this point.

The Employment Tribunal acknowledged that the answer to this question involves a two-stage analysis.

First, it must determine whether the ‘irreducible minimum’ of mutuality of obligation and a sufficient framework of control exists in periods between trips. The Employment Tribunal held that the conclusion varied between the claimants:

  • For two of the claimants, there was no mutuality of obligation because Bolt had communicated to them that it was no longer operating a minimum acceptance policy. There was therefore no ‘worker’ contract until these claimants accepted a trip.
  • For the remaining six claimants, Bolt failed to communicate the decision to discontinue its minimum acceptance policy. Therefore, there was a ‘worker’ contract whenever these drivers (a) were in the territory that they are licensed to operate and (b) had the Bolt app switched on.

The second part of the analysis is to determine when a Bolt driver is ‘working’ under the established ‘worker’ contract. The Employment Tribunal followed the analysis in Uber BV v Aslam, finding that where a ‘worker’ contract exists, the driver is ‘working’ when he is (a) in the territory for which he is licensed, (b) has the Bolt app switched on and (c) is ready and able to accept trips.

Takeaways for employers

The decision in Bolt is the latest in a string of cases relating to the so called “gig economy”. Employers in this space need to mindful of the risks of worker status misclassification as the trend is for individuals to be given “worker” status.

The exact level of compensation which the drivers will receive as a result of this decision remains to be seen but it is anticipated that it could be extensive. The case highlights the importance of looking at the practical reality of the relationship that exists between the parties when evaluating the employment status of workers, rather than just the contractual terms.

Bolt’s failure to communicate that it had changed its policy in relation to minimum acceptance rates severely undermined its argument, demonstrating the need for employers to clearly and effectively communicate policies to their workers if they wish to rely on their existence when determining worker status.