Employment law solicitor Richard Grogan of Richard Grogan & Associates writes on the classification of workers in the gig economy.

The issue of who is and who is not an employee is now becoming a significant issue going before AOs, as seen in case ADJ-3763.

In this case, the AO has given a very considered and reasoned opinion as to why the relevant individual was not an employee. In this case the AO found that the individual had actively sought to be a self-employed individual.

The decision makes absolute sense to us. There is, however a wider picture.

There are significant issues for the State where individuals are not properly specified as employees and are put into a category as self-employed. This means that there is loss of Revenue to the State particularly in employers’ PRSI. This is a huge cost to the State.

There will be arguments in the years to come the issue of claims being brought by persons who are classified as self-employed who are in fact employees is going to be significant and it is likely that a considerable number of these cases are going to go to the Labour Court in due course.

Because of the potential downside for employers who have placed any large number of employees into the category of self-employed, the economic cost to the employer of losing a case in the Labour Court may well mean that more of these cases will go to the High Court, simply because the economic cost of going to the High Court on a point of law will be far less for such an employer that the cost of converting any group of individuals from self-employed into employee status.

This is an area of law which we see developing in the coming years and where the Labour Court is going to have a significant role to play in developing the jurisprudence in this jurisdiction.