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July 30, 2018

JULY'S NEWSLETTER

Pimlico Plumbers and the Gig Economy


  

The so-called ‘gig economy’ is characterised by short-term contracts or freelance work and has coined its name from individuals being paid for each job or ‘gig’. The phrase has become more well-known following the recent high profile rulings in cases involving Uber, Deliveroo and more recently the case of ‘Pimlico Plumbers.’  

Gary Smith’s case against Pimlico Plumbers, which has been running since 2011, is the latest in a long line of legal challenges on employment status. The Supreme Court upheld the previous decision by the Court of Appeal that Gary Smith, who worked for Pimlico Plumbers, could be described by a worker despite signing an agreement with the company describing himself as self-employed.

Rebecca Hilsenrath, chief executive of the Equality and Human Rights Commission (who have been funding the case on behalf of Gary Smith since 2015) commented that:-

“If you wear the uniform, if you drive the branded vehicle, if you only work for one business, you are employed. That means you are entitled to the appropriate protections and adjustments which go with the job, to enable you to work safely and productively. Everyone has the right to a healthy working environment, and to that end businesses need to recognise their duties to their workers.”

Worker status means entitlement to a national minimum wage, holiday pay and protection from discrimination. This case highlights the weaknesses in businesses labelling individuals ‘self-employed’ when in practice, the level of control that they are able to exert over the individual is more indicative of a worker or employer/employee relationship.

The ruling however, did not provide further guidance or add anything to the current test for establishing whether someone is a worker and difficulties continue to be prevalent for businesses distinguishing between an employee and a worker or between a worker and an independent self-employed contractor.

Further guidance is expected when the Court of Appeal hear an appeal in the Uber case in October 2018.

In addition to upcoming case law, the 2017 Taylor Review of modern employment practices made recommendations that included that people who work for platform-based companies, such as Deliveroo and Uber, be classed as dependent contractors.

The government formally responded to the Taylor review in February 2018, and acknowledged that there is a lack of clarity over employment status and have begun consulting over how the test for employment status could be defined, clearly and certainly, within legislation. In addition, and alongside their responses to the Taylor review, the government launched a Consultation on Employment Status which, among other things, asked for responses on whether to introduce an online tool to help determine employment status (this could be in addition to or as an alternative to legislative change).The consultation ended on 1 June 2018.

The above rulings, and proposed changes, do not mean that a business cannot legitimately engage individuals on a self-employed/worker basis, however, due to the recent case law evidencing that employment tribunals are taking an ever more pragmatic view on employment status, we would recommend that businesses that engage individuals on a self-employed or worker basis seek legal advice to determine whether there is a risk that their status may be challenged at a later date.  

The employment team at Greenaway Scott are more than happy to assist with any clarification or further information regarding employment status. Please contact us at employment@greenawayscott.com.

Artificial intelligence: Challenges for Intellectual Property


Artificial intelligence (AI) is a term used to describe a range of software functionality, working in parallel with ‘machine- based learning’. This new and emerging area expands across many different industries and sectors and is encapsulated in an equally wide legal framework. Companies who use AI need to be vigilant in protecting and enforcing their rights, by implementing an extensive strategy to protect their intellectual property (IP) rights within artificial intelligence.

Third party rights

The breach of third party intellectual property rights is a concern for companies who will undoubtedly be seeking to protect their business as far as possible. Under section 16(2) of the Copyright Designs and Patents Act 1988, artificial intelligence systems cannot violate copyright regulations, as copyright can only be infringed by a ‘person’. As a result, the person in control of the system will be held liable.

Going forward, developers should seek to control the risk by embedding the acknowledgement of intellectual property rights within the artificial intelligence system itself. Essentially, developers of artificial intelligence should teach their software to respect the rights of third parties. This is especially crucial if the system is in control of a task which is out of the hands of the operator.

Content creation

Another challenge companies may face is in relation to content creation. The use of artificial intelligence systems in this area will limit, or even remove the need for human input. Regarding copyright, the definition of such a right is made by reference to a human author. Therefore, it is not possible for an artificial intelligence system to be classed as an author.

Originality of work comes from a human, an artificial intelligence system cannot exercise the same skill, labour and judgement or engage in intellectual creation as that of a human. However, one possible source of originality in artificial intelligence systems may be in the skills or intellectual creation expanded within the training process of the system, which enables artificial intelligence to create specific types of content or in building the underlying learning algorithm.

Patent ownership

Another challenge faced by many companies is the question of who owns the patent of an idea generated. Should an artificial intelligence system be allowed ownership? Traditionally, inventing is seen as a human enterprise. Section 7 of the Patents Act 1977 refers to the inventor being a person and to ownership vesting primarily in the inventor. Equally, in attributing patents to people who are not the inventors as a result of patent law, the artificial intelligence system is not being recognised for its invention. However, acknowledging an artificial intelligence system as an inventor could lead the invention to fall into the public domain.

Going forward, it may be wise to approach the issue of artificial intelligence patent ownership by form of agreement, as opposed to leaving it to the Intellectual Property Office and the courts to decide on the matter.

Future of artificial intelligence in IP

The Government, in its policy paper released on 26th April 2018, believes that the UK has the potential to lead the way in the artificial intelligence sector. Presenting a strategy, the Government have made their future intentions clear. Although there was no mention specifically of the challenges intellectual property will face, the time will come in which these issues will need to be addressed.

 

Start-ups and Intellectual Property


All businesses have intellectual property, it can be a valuable asset that will need protecting and allows start-ups to have a competitive edge.

What is intellectual property?

The term ‘intellectual property rights’ describes a range of legal rights that can attach to certain information, ideas and creations such as inventions, names and images. They generally fall into two categories. Unregistered rights for which protection arises automatically, this includes copyright, unregistered design rights and rights in unregistered trademarks. There are also registered rights which include patents, trademarks and registered designs. An application must be made to an official body to protect these rights, for example the Intellectual Property Office in the UK.  The owners of such rights are entitled to prevent their unauthorised use and can also exploit them to generate an income.

Type of intellectual property protection

Copyright – copyright automatically arises when an original work in a relevant category is created. Due to its automatic protection it is one of the most simple intellectual property protectors and it provides the owner with a number of rights and legal benefits to prevent unauthorised use and exploitation of the protected work.

Trademark – this is a registered right in which is applied for at the Intellectual Property Office. There are specific requirements such as it being a distinctive sign which is used to identify particular goods and services provided by that business. The trademarked sign must be distinctive and not misleading. It cannot be identical to an already registered trademark.

Patents – patents are one of the most effective ways of encouraging innovation and improvisation by ensuring inventor’s works are protected and that they are being rewarded. Patents last for 20 years in which the owner can exploit their right as they wish. Patent applications are lengthy and complicated, however the grant of a patent will greatly benefit the business.

Industrial design protection – this protection allows you to protect the aesthetic aspects of a product such as surface decoration. Industrial design protection only takes into account the aesthetic aspects and does not consider the functionality of the product.

The importance of intellectual property protection

Intellectual property can be used a unique investment opportunity and allows your business to be differentiated from others. Intellectual property creates good value for your business and a high entry barrier is created allowing you to develop your business without the threat of competitors using your ideas or branding. Intellectual property creates a competitive advantage for start-ups.

The benefits of protecting your intellectual property

Intellectual property can differentiate your business from others, from a customer and investor perspective. It allows customers to distinguish and easily identify your brand. Investors may be more attracted to your business if they can see that you have protected your intellectual property.

As mentioned above, when intellectual property rights are registered you are entitled to exploit those rights. This is an advantage as it allows additional revenue by selling or licensing your intellectual property.

Contact our team if you need legal support in any of the areas covered in this month's newsletter.

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