Takeaway service Deliveroo has won the latest round of a legal fight over the status of its riders.
The Independent Workers’ Union of Great Britain has been representing a group of riders since 2017 in a bid for them to be recognised as “workers”, eligible for union recognition and the ability to engage in collective bargaining for better terms and conditions.
However, on Thursday (24 June) the Court of Appeal upheld previous verdicts that Deliveroo riders should be deemed self-employed. The company’s share price shot up 9% as a result, adding almost £400m to its stock market value.
The ruling focused on the fact that the riders enter an agreement with Deliveroo that permits them to use substitutes. There is no obligation for them to be available if a job appears on the app, and jobs are based on proximity to the point of collection.
This is the key difference between this case and that of Uber, which in February lost a Supreme Court case on employment status. The Court unanimously ruled that Uber drivers are workers.
The ride-hailing app has since agreed to recognise a trade union for the first time, in this case GMB, to represent drivers in pay discussions and negotiations on terms of work.
Lord Justice Coulson, one of the judges presiding, said: “It may be thought that those in the gig economy have a particular need of the right to organise as a trade union. So I quite accept that there may be other cases where, on different facts and with a broader range of available arguments, a different result may eventuate.”
Commenting on the decision, a Deliveroo spokesperson said: “UK courts have now tested and upheld the self-employed status of Deliveroo riders four times. Deliveroo’s model offers the genuine flexibility that is only compatible with self-employment, providing riders with the work they tell us they value.”
Joe Aiston, senior associate employment lawyer at Taylor Wessing, said that comparisons between the Deliveroo and Uber cases would be “inevitable” as they both focus on gig economy workers.
“The [Deliveroo and Uber] cases were considered under different legal tests, meaning the reasoning and judgements cannot necessarily be directly compared.” – Joe Aiston, Taylor Wessing
“The cases were considered under different legal tests, meaning the reasoning and judgements cannot necessarily be directly compared,” he explained.
“In the Deliveroo case, it was determined that riders were not workers when it came to the ability to take part in union activity. The reason for this is that they can ‘substitute’ by asking someone else to carry out a delivery for them.
“In the Uber case, there was an emphasis on the level of control exerted by Uber over its drivers. Uber drivers were controlled by and dependent on Uber.
“Uber drivers can’t substitute in the same way as Deliveroo riders can, as they are restricted both by Uber’s business model and the licensing requirements of private hire vehicles.”
Aiston added that this was a likely explanation for Uber continuing to treat its own takeaway (Uber Eats) riders as self-employed and not workers, as the lack of a licensing regime means that food delivery drivers can substitute.
Dave Chaplin, CEO of contracting authority ContractorCalculator agreed that gig economy cases tend to be “very fact-sensitive”.
“A lay-person looking on will wonder why Uber drivers were declared workers not so long ago whilst Deliveroo rides are not. It begs the question: what’s the difference between delivering a person or a package?
“The answer – the point is not relevant in law. Flexibility is beneficial for economies, but when codependent relationships crystallise to one akin to regular employment then rights should surely follow? But, where this isn’t the case, parties should be able to enter into contracts in good faith and expect them to hold up in law, with no interference.”
The IWGB is yet to make a decision on whether to take the case to the Supreme Court.
Alex Marshall, the union’s president, said: “Deliveroo couriers have been working on the frontline of the pandemic and whilst being applauded by the public and even declared heroes by their employer, they have been working under increasingly unfair and unsafe working conditions.
“The reward they have received for their Herculean effort? Deliveroo continuing to invest thousands of pounds in litigation to silence workers’ voices and deny them the opportunity to negotiate better terms and conditions.”