The gig economy sounds fun, doesn’t it? The phrase evokes images of piling into a van with your mates in the band; maybe you only got paid in beer this time, but it’s been an exciting night and next time you might get some cash.

It’s less appealing when it’s your only source of income. It’s also less fun if you later find out that a multinational company made a decent profit on your gig’s ticket sales. So what happened to proper jobs? That’s obviously a complex question, but it’s no coincidence that the gig economy has grown at a time when employment rights have become harder to enforce and social security has become more difficult to obtain. In short, as more companies see paying tax as optional, many have sought to opt out of established employment practices, sometimes on a huge scale.

But some interesting cases are now coming through, showing how the gig economy is sometimes just an old-fashioned sham to deprive workers of their proper rights. Uber was in the news after its employment tribunal defeat in October 2016 (Aslam and others v Uber BV and others Case Nos 2202551/2015 and others, 28 October 2016; [2016] EW Misc B68 (ET)) and is now appealing to the Employment Appeal Tribunal. The Court of Appeal gave judgment in the Pimlico Plumbers case in February (Pimlico Plumbers Ltd and Mullins v Smith [2017] EWCA Civ 51). A challenge to the practices of Deliveroo is also on the cards.

In October 2016, Central London Employment Tribunal ruled in favour of the Uber drivers, rejecting the company’s claim that it did not have a contract with the drivers. The tribunal found that they were indeed workers. This was relevant for their entitlement to, and Uber’s compliance with, the minimum wage, paid leave (breach of the Working Time Regulations 1998 SI No 1833) and whistle-blowing protections. The tribunal looked in detail at the working arrangements. Clearly, the control of the business was very largely, if not entirely, in the hands of Uber. The contractual arrangements were between customers and Uber and between Uber and its 40,000 drivers. Uber’s arguments that it was just a tech company facilitating contracts between customers and drivers were found to be nothing more than ‘pure fiction’.

It is interesting that Uber relied on two cases which – at least to me – hint at the context more than legal principles. One concerned the Royal Hong Kong Golf Club, as it existed in 1995 (Yuen v Royal Hong Kong Golf Club (1997) 28 July, PC, unreported). Mr Cheng, who was 82, worked as a golf caddie until the club told him he was no longer needed and dismissed him without pay. The club took the view that Mr Cheng was not employed by it at all but that club members engaged him as an ‘independent contractor’ to caddie them on each round of golf. Ultimately, a majority of the Judicial Committee of the Privy Council held that he had not been employed by the club.

The other case on which Uber relied led to a judgment in favour of Stringfellow Restaurants, where the claimant, Ms Quashie, worked as a lap-dancer in one of Peter Stringfellow’s notorious strip clubs (Stringfellow Restaurants Ltd v Quashie [2012] EWCA Civ 1735). It is instructive to read the very controlling terms and conditions to which dancers in strip clubs have to sign up, in order to be allowed to work. Most permanent staff tend to be male and have employment rights; by contrast, the (female) dancers are invariably required not only to be ‘self-employed’ but also to be held responsible for any breaches of licence conditions. At the same time, the insecurity caused by this ‘self-employment’ creates a strong incentive for dancers to break those licence conditions.

A key line from Elias LJ in the Stringfellow judgment is that the ‘fact that the dancer took the economic risk is also a very powerful pointer against the contract being a contract of employment’ (para 51). And it was distinguished in the Uber case, where the drivers have so little control over the business that they cannot be said to carry the economic risk.

Ultimately, the difficulty with gig economy cases is untangling the facts. The principles on sham contracts are nothing new.