Travel from home straight to a customer? The rules have changed

The European Court of Justice (ECJ) decided in September 2015 that travel time counts as working time.

‍This applies when a worker doesn't have a fixed place of work but is required to travel from home at the beginning of the day to the premises of a customer, and to return home from the premises of another existing customer – following a list or route determined by the employer.

The case in question

Privados del Sindicato Comisiones Obreras v Tyco Integrated Security was a case about Spanish workers who installed and maintained burglar alarms for their employer, Tyco.

In 2011, Tyco shut down their regional offices and attached all employees to a central Madrid office, resulting in employees having to travel various distances - up to three hours - from home before arriving at their first appointment. The employees argued that their working time should start from the time they left home, while Tyco argued that their working time should start when they reached their first customer. The Spanish Courts asked the ECJ to consider the case.

In July 2015, the ECJ’s Advocate General gave his opinion that for employees with no fixed workplace, their time spent travelling from home to the first customer and from the last customer back home counted as “working time”.

‍The ECJ agreed in September, saying that the fact staff began and ended their journey at home didn't come “from the desire of the workers”, so they shouldn't be forced to “bear the burden of their employers' choice to close these offices”.

UK lawyers got involved in the case, asking the ECJ to consider the costs to businesses, especially where travelling time as work could be abused by dishonest employees to carry out personal business. The ECJ said it was up to companies to prevent that by implementing monitoring systems, e.g. tracking petrol costs and mileage.

What the judgement means

This will impact the UK and all across Europe. It doesn't necessarily affect pay – this is only about hours of work.Although some reports of this ruling in the UK press made it sound like all staff had to be paid from the moment they leave home, this isn't the case. It'll only affect those staff who are not required to enter a regular or fixed place of work at the start of their day/shift but go straight to a customer/client – e.g. some care workers, salesmen, utility engineers, maintenance workers, some delivery drivers, and so on – whether employees, workers or agency staff.

However, it’s not yet clear if this will only apply to mobile workers in a similar situation, i.e. subject to the closure of regional/local offices, or if it’ll apply to all mobile workers – for example, those who have always made their first and last journey to/from customers’ premises.

It's certain that employers will need to look at their contracts and conditions for staff - in terms of hours worked, breaks, opt-out clauses, how work is scheduled and by whom, place of work, conditions and perhaps, ultimately, wages.Whether the company controls the time spent between home and the first customer because it tightly schedules the appointments for the employee, or the employee has the flexibility to manage the itinerary will be key in deciding if this decision affects your staff.

It will not affect the self-employed/contractors. One estimate suggests that just under a million workers could be affected by the judgement. The ECJ ruling said:

"Where workers, such as those in the situation at issue, do not have a fixed or habitual place of work, the time spent by those workers travelling each day between their homes and the premises of the first and last customers designated by their employer constitutes working time within the meaning of the [Working Time] directive."

It added that the workers were “at the employer’s disposal” during the journey because they acted under their employer’s instruction and couldn't use that time freely to pursue their own interests.

The ruling impacts on mobile workers because Working Time legislation states that you can't work for more than 48 hours per week, which is normally measured over a 17 week ‘reference period’ rather than counted on a week-by-week basis.

For staff currently working 48 hours a week, including travel time in the ‘working time’ calculation may see them exceed the 48 hour a week limit.

Opt-outs

Employers can ask workers to voluntarily sign an opt-out of this 48 hour limit which is legally valid – i.e. workers agree that they'll work for more than 48 hours per week – if they haven't already done so.However, the opt-out cannot be a condition of a workers employment (they're only employed if they sign it) and it must remain optional and voluntary.

Therefore, if a worker signed their contract with an opt-out in place, they still have the legal right to opt back into the 48-hour limit at a later date. The worker has to give their employer a minimum of seven days written notice by law to do this. However, many employment contracts require a longer time scale to opt back in - often three months.

Other Information on opt-out’s:

• Young workers can't opt-out.
• Employees shouldn't be subjected to any detriment by refusing or proposing to refuse to sign an opt-out agreement. If an employee was dismissed because they refused to sign an opt-out clause, this could be seen as automatically unfair dismissal (which they don't need two years service to claim).
• The number of hours employees work per week can be averaged by an employer over the applicable 17/26 reference week period, rather than measured in one week. However, with the daily and weekly rest breaks and the opt-out above included, the maximum in any week an employee should work is 78 hours.
• If a worker agrees to opt-out voluntarily, this may solve any problems caused by the ruling – as long as their working hours are accurately recorded over the applicable ‘reference’ period.
• Breaches of the 48-hour limit are dealt with by the Health and Safety Executive (i.e. a prosecution and/or a fine for the employer, but not compensation for the worker).

More information on what else is and isn’t included when calculating the ‘working week’ is available in our Working Time Regulations article.

Rest breaks

Including travel time may leave workers without an 11 hour rest break between shifts, which they're entitled to under Working Time legislation (unless they work in an industry that is exempt from the need for these rest breaks [see details here]), which may drive up costs to accommodate/cover work during the rest periods.

Creating a fixed place of work

Employers could ask staff to attend an office/fixed place of work first (to collect their van, for example, and again at the end of the day), but this could extend the working week beyond 48 hours, too.

It's not clear whether this ruling also applies where an employer has several offices or locations and a worker isn't allocated to any of them, but visits many of them separately on their first/last journey. This may be seen as ‘normal’ commute time.

Some businesses may react by reducing workers hours to avoid them working over 48 hours. This may lead to increased costs of recruiting extra workers.

Businesses may be able to schedule the first and last appointments closer to a workers home to avoid large chunks of time being classed as working time.

Ignoring the ruling

Some employers may just risk their staff working more than 48 hours per week (without a valid opt-out) as the ‘risk’ of staff bringing claims as their employer is in breach of the WTR may be small.

Affect on pay

This ruling doesn't mean staff will get paid more for their overall time - it's all about health and safety. Trade Unions are now demanding that workers get paid for this travelling time and it's obvious workers will demand more pay, but employers may not need to agree to this.

If workers are entitled to overtime, this may be an issue, so check what your contracts actually say.

The UK’s National Minimum Wage legislation is a UK law and isn't imposed by Europe, as there's no European right to a National Minimum Wage.The NMW says that workers must be paid at least the NMW for all the hours they work. However, the legislation currently says that travel time to work, or to a customer’s premises, at the beginning and the end of the day doesn’t count as ‘time work’, so isn’t included in the NMW calculation.

Watch this space for future developments as the NMW and WTR laws often interact with each other (and confuse each other). There may be pressure on NMW legislation to change in future.

Thera East v Valentine 2017

In Thera East v Valentine, December 2017, the Employment Appeal Tribunal considered whether workers who fell under the Tyco principle were entitled to be paid for their first and last journeys of the day. Valentine worked for a charity as a support worker, assisting disabled people in the community and driving his own car for work. In his contract, he was paid on an annualised hours basis; travel from his home to his first assignment, and then from his last assignment to home each day, weren’t included in these hours. The contract also stated that any hours worked in excess of the annualised hours were given back as time off in lieu.

Following the Tyco decision, Valentine claimed that these first and last journeys were working time and claimed time off in lieu for this travel time.  He didn’t, however, claim that the failure to pay him was an ‘unlawful’ deduction of wages.  The original employment tribunal agreed that the travelling time constituted working time and went further to decide that the employer had made an unlawful deduction from his wages by failing to pay him for his travelling time.

The EAT didn’t agree – the tribunal had been wrong to decide that the employer had made unlawful deductions from his pay when Valentine himself hadn’t claimed this. They decided also that it was clearly that there hadn’t been unlawful deductions from his pay, since Valentine’s contract was clear that he had no entitlement to wages in respect of time spent travelling. The EAT went on to say that Tyco made it clear that the Working Time legislation is not concerned with questions of payment for working time.  Therefore, the Employer could determine the amount of wages an employee should receive for their travelling time – the contract set out clearly that no payment would be made.

This case didn’t touch on whether the National Minimum/Living Wage should be paid for such travelling time; currently, there’s no case law on this.

September 2020 update

In Mr T Holloway v Aura Gas Ltd, an employment tribunal found that Mr Holloway, an engineer, was unfairly constructively dismissed (and wrongfully dismissed) after he resigned over a dispute about his pay while travelling for work, where his employer refused to pay him overtime for travelling between jobs. The tribunal found this was a “fundamental breach of contract and a fundamental breach of the implied term of trust and confidence in Mr Holloway’s contract of employment with the company”.

Mr Holloway was a heating engineer for Aura Gas from January 2015 until he resigned in September 2019, reporting to the MD Gary Robinson. When he started his conditions of employment said he would be required to travel to other locations and would be expected to work 45 hours per week. The tribunal heard that Mr Holloway spent the majority of his working time at customers or travelling to suppliers.

Mr Holloway said that, initially, his jobs were fairly local, but that over time the distance of travel to jobs increased and said that “it was known for me to travel up to five or six hours per day additionally to my contracted hours…”. In October 2018, Holloway corresponded with Robinson about the ‘unofficial travel rules’ that a colleague had told him had been changed. Robinson said “Travel is definitely not included in your working day, and we do not pay you to travel unless over the hour” (the first or last hour of travel were not paid). Holloway was asked to attend an investigatory meeting on 18th June.

After Holloway was asked to attend an investigatory meeting on 18th June (for charges that he was refusing to work his contractual hours, that he was falsifying his time sheets, dragging out jobs and not completing reasonable work requests), he wrote to the Technical Manager of Aura Gas, Martin Cornell, on 11th June, setting out several formal grievances – that he was not paid for all the overtime he incurred while travelling between jobs; that the company had reduced his pay from ‘double time to time and a half’; that he was “always given the job that involves the furthest distance”; and that he was undermined by Robinson while at work.

Holloway’s grievances were heard and rejected at the end of July; he appealed but this was rejected on 11th September. On 13th September he handed in his resignation and brought claims of unfair dismissal and breach of contract in relation to unpaid wages.

The tribunal said that Holloway’s complaint of breach of contract for unpaid overtime wages was well founded. It also ruled that Holloway was wrongfully and unfairly constructively dismissed because of the travel time wage dispute. Aura Gas were ordered to pay Holloway unpaid overtime wages, unfair dismissal and wrongful dismissal compensation, totaling nearly £12,000.

At no point had Holloway been asked to sign an opt-out to agree to work over the 48 hour weekly legal maximum limit (in the Working Time Regulations), which his travelling time had often pushed him over.

If you are an Employer and need ongoing professional help with any staff/freelance issues then talk to Lesley at The HR Kiosk  – a Human Resources Consultancy for small businesses – our fees are low to reflect the pressures on small businesses and you can hire us for as much time as you need.

Please note that the advice given on this website and by our Advisors is guidance only and cannot be taken as an authoritative or current interpretation of the law. It can also not be seen as specific advice for individual cases. Please also note that there are differences in legislation in Northern Ireland.‍