The Supreme Court in the UK has held that food delivery riders (Riders) were not in an ‘employment relationship’ for the purposes of Article 11 of the European Convention on Human Rights, meaning that the provisions of that article which protect the right to form and join trade unions do not apply to them.   In so holding, the Supreme Court upheld the decision of the Central Arbitration Committee (CAC), the High Court and the Court of Appeal.    

In November 2016, the Independent Workers Union of Great Britain (the IWGB) made a formal request to Deliveroo to recognise it for collective bargaining in respect of a group of Riders in the Camden and Kentish Town area.  Deliveroo rejected this request and the IWGB made an application to the CAC.  The CAC rejected the application on the basis that the Riders did not fall within the domestic definition of “worker” under section 296 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULR(C)A).  Under that act, “worker” means an individual who works, or normally works or seeks to work:

(a)  under a contract of employment, or

(b)  under any other contract whereby he undertakes to do or personally perform any work or services for another party to the contract who is not a professional client of his, or

(c)  in employment under or for the purposes of a government department (otherwise than as a member of the naval, military or air forces of the Crown) in so far as such employment does not fall within paragraph (a) or (b) above.”

A key element of being a limb (b) worker is that the worker agrees to perform work or services “personally” for the other party.

The CAC also rejected the alternative argument that a refusal to recognise the IGWB for collective bargaining based on the definition of worker in the domestic legislation would constitute a breach of Article 11 because they are workers for the purposes of that article.  A judicial review claim was brought on a number of grounds and permission for judicial review was only permitted on the article 11 ground.  This was dismissed by the High Court and the Court of Appeal and the IGWB therefore appealed to the Supreme Court.

The Supreme Court identified various issues that it needed to decide.  The main one was whether the Riders fell within the scope of Article 11 such that the rights to join and be represented by a trade union are conferred on them.  In determining this, the Supreme Court considered that, looking at previous EU case law it was necessary to consider whether the Riders were in an “employment relationship” with Deliveroo for the purposes of European human rights law.  One of the main factors was whether the right to engage a substitute to perform the services was an impediment to the union’s case.   

Supreme Court decision

The Supreme Court held that there was no employment relationship and agreed with the CAC decision that one of the main areas to focus on was the right to appoint a substitute set out in the agreement between the Riders and Deliveroo. The Supreme Court held that the power of substitution was a broad power which was virtually unfettered.  It was not limited to other Deliveroo Riders and the only restriction was that the substitute could not be anyone who had previously had their supplier agreement terminated by Deliveroo for a serious or material breach of contract or who, while acting as substitute would have had any agreement terminated if they had been directly appointed. There was also no monitoring of the use of a substitute or any sanction if a substitute was used.  The arrangement was a private arrangement between the Rider and the substitute.  The Supreme Court also considered whether the substitution power was used in practice.  Although the use of the substitute was rare, mainly because there was no need for a rider to engage a substitute if they did not want to accept a job, there were circumstances where it was used.  This could include a Rider using a substitute for profit.  This contrasted with other worker status cases where the power of substitution was fettered to such an extent that it was not used which meant that the dominant feature of the contract was an obligation of personal performance.   In this case the Supreme Court held that such a broad power of substitution was, on its face, totally inconsistent with the existence of an obligation to provide personal service which is essential to the existence of an employment relationship within Article 11. 

The Supreme Court held that this was in itself enough to determine that there was no “employment relationship”.  However, it also noted that in determining whether there is an employment relationship within article 11, the court should consider, amongst other matters, the factors set out in ILO Recommendation No 198 (i.e it should be guided primarily by the facts relating to the performance of work and the remuneration of the worker, notwithstanding how the relationship is characterized in any contrary arrangements).  There were, in this case, other features in the way in which the Riders performed their services which added to the decision that the relationship was inconsistent with this being an “employment relationship”.  These included that:

  • Riders did not have to carry out any deliveries at all.
  • Riders did not work within specific working hours. They operated if and when they choose.
  • Riders’ place of work was not specified or agreed.
  • Riders’ activity was not of a particular duration, nor did it have a certain continuity. Riders started and stopped when they chose.
  • Riders were not required to be available.
  • Riders provided all their equipment at their own expense. They used their own cycles and mobile phones.
  • There was no periodic payment. Remuneration depended on whether Riders chose to make deliveries and how many deliveries they made.
  • Deliveries were not necessarily or typically a Rider’s sole or principal source of income. Even if they were, a good proportion of Riders may also earn from Deliveroo’s direct competitors.
  • There was no payment in kind such as food, lodging and transport.
  • There was no entitlement to weekly rest and annual holidays.
  • There was no reimbursement for the cost of travel; and
  • There was no protection from financial risk for Riders, whether in the form of insurance, guaranteed earnings or otherwise

The case provides an important view on whether the unfettered right to substitution will be sufficient to determine that the individual is not a worker but is truly self-employed.  In this case the clause was unfettered and the Supreme Court took into account that it was a genuine right.  In these circumstances it may be sufficient to make the status determination without further consideration of the multifactorial test.  However, the nature of any right of substitution will need to be looked at on a case by case basis as it will differ across companies and industry sectors.

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