News & Insights: Employment

Delivery riders are not employees – Deliveroo wins Supreme Court case

28 November 2023

Independent Workers Union of Great Britain (Appellant) v Central Arbitration Committee and another (Respondents)

Employment legislation is used to regulate businesses’ behaviour and prevent them from exploiting people. In general, laws protect consumers who buy from businesses and workers employed by businesses. Independent Workers Union of Great Britain (Appellant) v Central Arbitration Committee and another (Respondents) is the latest attempt to rebalance the much-desired natural equilibrium between the rights of the employee and employer obligations.
The UK Supreme Court, the highest Court in the land, has ruled that Deliveroo riders cannot be recognised as workers. This decision has major ramifications for the gig economy which refers to the workforce of people engaged in freelance and side-hustle work. The decision will be considered a win for gig economy as it means their workers cannot be represented by unions for collective pay negotiation power. It is a major blow for workers and unions who have advocated increased rights, benefits and entitlements for gig economy workers for many years now. Some commentators have referred to the current lack of regulation in the gig economy sphere as the ‘wild west.’
The Independent Workers’ Union of Great Britain (IWGB), which has the largest membership of app-based couriers in the UK, had fought the case for more than seven years on behalf of tens of thousands of Deliveroo riders across the country. The workers relied upon Article 11 of the European Convention on Human Rights to mount the challenge. They had tried to negotiate pay and conditions with the company but were refused in 2017 as the members did not meet the definition of a worker under UK law. A series of appeals launched since then and this decision is the climax of the long running saga.

Judgment

In a unanimous judgment on Tuesday, five judges said the contracts between riders and the company did not constitute an ‘employment relationship’ and the arrangements between Deliveroo and its riders is ‘fundamentally inconsistent with any notion of an employment relationship.’ This is because riders were able to use another person to cover their deliveries without Deliveroo’s involvement, they don’t have specific hours and can work for rival companies and competitors.
The Court stated that ‘riders are thus free to reject offers of work, to make themselves unavailable and to undertake work for competitors. Once again, these features are fundamentally inconsistent with any notion of an employment relationship. Deliveroo welcomed the decision as a ‘positive judgment’ and that ‘thousands apply each week to work with Deliveroo because they want to be able to decide for themselves when, where and whether to work.’

Impact

This high-profile ruling will potentially lead to other gig economy companies adopting the Deliveroo employment approach. In 2021, the UK Supreme Court ruled that Uber would have to classify its drivers as employees in a case that draws parallels between the two companies both operating in the sphere of the gig economy. As a result of the Uber case, some commentators were surprised by this decision.

Future developments

This decision is in the context of the European Union discussing new rules to give enhanced employment protections to those working in the gig economy across EU member states. Under proposals agreed by the European Council, the EU’s executive body, companies that control workers’ hours, what they wear at work and restrict whether they can accept or turn down work will have to class them as employees.

The Independent Workers Union is now in the process of considering taking the case to the European Court of Human Rights in Strasbourg to argue that denying riders access to a union may be a violation of their rights. Under Article 11 of the European Convention on Human Rights, people are free to assemble and associate with others, including by forming trade unions.

Further advice

O’Reilly Stewart Solicitors continues to represent the interests of large numbers of employers and employees in a variety of employment disputes in both the public and private sector. For support and advice please reach out to info@oreillystewartsolicitors.com to speak to Seamus McGranaghan or Sasha Conlon, members of our employment team at O’Reilly Stewart.

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