Is a contractor entitled to receive holiday pay under the Working Time Directive?
According to a recent European appeal court judgment regarding a Yodel delivery driver, the answer to this question is no – but only if the contractor in question is “genuinely independent and is not subordinate”.
A courier made a claim for holiday pay. His contract specified that he was an independent contractor and provided him with a right to appoint a substitute with no limitations – stating that the substitute must be suitably qualified. The courier was entitled to set a limit on the number of parcels that he would deliver, had flexibility about when to deliver them (unless a customer had requested a particular time slot), and could work for a competitor without restrictions.
The appeal court concluded that an employment relationship implies the “existence of a hierarchical relationship between a worker and his employer, in which the worker is subordinate to his employer”. In this case there was no hierarchical relationship. The courier was independent and that there was no relationship of “subordination”. This is an important judgment but must be taken in the context of the particular relationship between the business and the independent contractor, in any specific case.