The firm, which previously brought a successful claim against Uber, argues that FREENOW private hire drivers are workers rather than self-employed contractors, meaning at least 20,000 drivers could be owed thousands of pounds in holiday pay and rectification of national minimum wage underpayments.

FREENOW denies the allegations and says it allows its private hire drivers to choose the employment status best suited to them.

Based in Germany, FREENOW operates in over 150 cities across Europe, including Dublin. It provides private hire vehicles, e-scooters, car sharing, taxis, public transport services, e-bikes and e-mopeds.

The claim in the English courts relates to the private hire services operated by FREENOW in London and the south-east of England.

Leigh Day employment partner Annie Powell, who is leading the claim, said: “We believe that all FREENOW private hire drivers are workers and that they should therefore have the employment rights and legal protection that come with that status.

“We will argue that by labelling private hire drivers as ‘self-employed contractors’, the owners of the ride-hailing app, BMW and Mercedes, are responsible for denying private hire drivers basic rights like paid holidays in order to cut costs.”

Responding to the lawsuit, Mariusz Zabrocki, UK general manager at FREENOW, said: “We are the first company to offer private hire vehicle drivers the choice of selecting the model that works best for them — worker or self-employed. All PHV drivers can move into worker status if that is their preference at any time, within the app with a couple of clicks.

“When given a choice, the self-employed model is the preferred option for the vast majority of FREENOW PHV drivers.

“Since we made this announcement, two months ago, only around 100 drivers selected worker status, despite direct information provided to PHV drivers, reminders in the app, over email and through public communication. It can’t be claimed that 20,000 drivers are denied worker status when it is literally two clicks away.

“We know these are challenging times and so FREENOW will continue to put drivers at the forefront of how we operate — we will not deny them their right to choose what is best for them regarding their employment status.”