Cécile de Lagarde discusses Deliveroo riders’ worker status in Lawyer Monthly

  • December 19, 2017
  • By Hunters Law

Deliveroo Might Have Won The Battle But Not The War On Worker Status

The food delivery app Deliveroo has successfully bucked the recent trend in the gig economy establishing workers’ employment status, after winning a landmark decision against its own riders. However, Cécile de Lagarde, Associate at Hunters Solicitors, explains to Lawyer Monthly why she believes this is not the end of the matter.

The Independent Workers Union of Great Britain (IWGB) brought the claim on behalf of Deliveroo riders in the Camden and Kentish Town districts of North London, arguing that they were entitled to a “worker” status, so that the union would be recognised for the purposes of collective bargaining. This would have enabled the union to negotiate with Deliveroo on behalf of workers on topics such as pay, hours and holidays[1].

In a landmark decision dated 14 November 2017, the Central Arbitration Committee (CAC) held that Deliveroo’s riders are self-employed, but denied them the “worker” status. The central question to be considered by the CAC was whether the riders, under their contract, had personally undertaken to perform any work or services for Deliveroo.

Deliveroo recruits its riders by way of a telephone interview and a trial session, during which the candidates and their bicycle are subject to a competency test assessed by Deliveroo trainers. This is then followed by an online training course, which has a particular emphasis on customer service, food hygiene and safety.

The CAC considered the contractual relationship between Deliveroo and the riders, as well as the practical aspects of their working conditions. Under their contract, Deliveroo riders are described as “independent contractors” who have the ability to decide when and where to work. Riders are required to provide their own equipment and are paid on a fee-per-delivery basis. They are also allowed to work for other organisations, including competitors. Crucially, Deliveroo had also recently introduced a right to substitute into its contract, which allows riders to nominate another individual to perform their duties in their place, without requiring Deliveroo’s prior approval. Under this provision, it is the rider’s responsibility to ensure that the substitute has the necessary skills and training.

The CAC underlined that, in practice, substitution was rare, and questioned the reason for which Deliveroo riders would appoint a substitute given that they were granted “total flexibility” to accept or decline jobs without bearing any adverse consequences. It was also puzzled as to why Deliveroo would “spend so much time, money and energy selecting and training” riders, when they can then use a substitute to replace them. Nonetheless, it held that, having “heard evidence […] of it being operated in practice“, it found it “to be genuine, in the sense that Deliveroo have decided in the new contract that riders had a right to substitute themselves both before and after they have accepted a particular job“. Thus, the CAC concluded that the contract did not impose an obligation to perform work personally. It did not really look beyond the substitution factor, as this was considered the key indicator in defining the status of a worker. The CAC therefore held that the contract between Deliveroo and the riders was not one of personal service and denied worker status to riders.

For some, the decision came as a surprise as it was just a week after Uber lost an appeal on its drivers’ worker status. However, there are crucial differences between how Deliveroo and Uber operate and contract with their riders or drivers. Uber drivers have no right of substitution and will be penalised by their employer if they decline work more than three times in a row by being logged out of the app for 10 minutes.

Whilst the CAC’s decision cannot be appealed (though it could be challenged by way of judicial review in the High Court), the legal battle on the ‘gig economy’ riders’ status is far from over. The Employment Appeal Tribunal is due to hear a claim in July 2018 brought by more than 40 Deliveroo riders who argue that they are entitled to workers’ rights. More precisely, they claim that they are entitled to basic employment rights, which include the right to be paid the national minimum wage, to receive sick pay and paid holidays and to protection against discrimination and in relation to whistleblowing, all of which are currently denied to them by Deliveroo. Solicitors who represent the claimants have stated that the CAC’s decision, although disappointing, will not impact the claims of their clients in the Employment Tribunal as their working agreement and conditions are different to those of the riders who were the subject of the CAC’s decision.

In the meantime, Parliament has begun to review employment and worker status in light of the gig economy recommendations set out in the Taylor Review of Modern Working Practices ‘Good Work’ Report. Some of the key recommendations of the Taylor Review are to rename workers “dependent contractors” and to remove the requirement for workers to have a contract to perform work personally by placing more emphasis on control. Whilst one may question the need to create another category of “dependent contractors”, the suggestion made to remove the requirement for workers to have a contract to “perform work personally” is welcome. This would make it harder for employers, such as Deliveroo, to use “substitution clauses” to deny worker status and would lead to more people being protected by employment law. Had the focus for determining worker status been on “control” rather than on “personal service”, the CAC’s decision might have been completely different.

[1] As per Paragraph 3(3), Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act 1992).

Cécile de Lagarde

Assistant solicitor at Hunters Solicitors

This article was originally published in Lawyer Monthly and can be accessed here

Related News

Jul 22, 2021
Gregor Kleinknecht and Constance Tait examine the impact on trademark litigation and provide 10 tips on navigating the post-Brexit era in Managing IP
Jul 16, 2021
Gregor Kleinknecht and Anastassia Dimmek examine the growing threat of zombie firms in Lawyer Monthly
Jul 07, 2021
Richard Baxter and Constance Tait examine a report suggesting that firms with targeted support for ethnic minority workers see benefits
Jun 28, 2021
Richard Baxter discusses UK-EU Data Protection and how adequacy decisions avoid imminent disruption to data flows
Jun 23, 2021
Richard Baxter and Constance Tait examine the recent Burnell v Trans-Tag Ltd case in the High Court
Jun 22, 2021
Anastassia Dimmek discussed the key challenges of protecting clients’ healthy businesses from zombie firms in a webinar hosted by Advoselect
Jun 18, 2021
Richard Baxter and Constance Tait discuss the looming annual returns deadline for employee share schemes
May 18, 2021
Hunters hosted the Withdrawal and The Trade Marks Act 1994 webinar
Mar 17, 2021
Stephen Morrall comments on Uber drivers entitled to minimum wage, holiday pay and pension following the Supreme Court decision in The Sunday Times Driving, The Times and the Daily Mail
Feb 19, 2021
Stephen Morrall comments on Uber losing a landmark Supreme Court battle in the Evening Standard and the Financial Times

© Hunters Law LLP 2021 | Privacy NoticeLegal & Regulatory | Cookies Policy | Complaints Procedure.

Hunters Law LLP is authorised and regulated by the Solicitors Regulation Authority (number 657218)