Uber, Deliveroo … The battleground of the gig economy
All has been quiet on the issue of worker v self-employment over the last couple of months, then like buses (or indeed taxi drivers), they all come at once.
The Employment Appeal Tribunal (EAT) has ruled that a group of Uber drivers were workers and were not operating as self-employed individuals on their own account. In contrast the Central Arbitration Committee (CAC) have concluded that Deliveroo couriers are not workers but are indeed self-employed. As a consequence the Uber drivers should receive the benefit of holiday leave and pay, breaks and a right to receive the national minimum wage and other rights afforded to workers, whereas the Deliveroo couriers will not.
So why are they different and what does this mean for other employers who rely on services being provided in a non-traditional way?
In the earlier Employment tribunal hearing, Uber maintained that it wasn’t a transport service but a technology platform linking drivers to customers via an app. They had argued they were effectively an agent for the drivers. The convoluted contract with the drivers described them as self-employed, the terms with the customer indicated that the contract was between the passenger and driver. Drivers could work when they wished but having logged onto the app had only 10 seconds to accept any booking before an alternative driver was sought. Failure to accept bookings resulted in warning messages and ultimately the driver could be suspended or blocked from the app completely and left without any work. Uber argued that the drivers could work for direct competitors, refuse work as they wished and cancel confirmed bookings. In short, they argued they were their own boss.
The EAT concluded that the original Employment Tribunal were entitled to conclude that the contractual documentation did not reflect the practical reality of the situation and that the Tribunal could therefore disregard the terminology on status used in the contracts. It found that whilst the drivers could choose when to work, once logged onto the app - they were working for Uber and integrated into its business. The high acceptance rate required to ensure they were not locked out of the app (80%) was seen to be evidence of this. It rejected Uber’s argument that the criteria relied on to find them to be workers was due to the regulatory requirements imposed on them and that such factors should be disregarded. Uber have already indicated that they intend to appeal the decision which is anticipated to cost them millions of pounds if applied to their 50,000 drivers in the UK. It is expected that they will seek to leapfrog the Court of Appeal and seek to join the case of Pimlico Plumbers which is to be heard before the Supreme Court on similar issues. Please click here for further details on this case.
In contrast, the CAC concluded the Deliveroo couriers to be self-employed as they were genuinely able to work for other companies within the same hour, could accept and reject assignments without penalty and ask others to deliver the food for them at any time, meaning they were not required to perform the work personally and could provide a substitute. They were also able to give examples of where this had happened in practice, even though it was rare. The Independent Workers Union of Great Britain had applied to the CAC for union recognition in order that they embark on collective bargaining with the company. However, this required them to prove that the couriers were workers or employees. Their bid has failed. However, it is not the end of the story as 45 Deliveroo couriers have issued proceedings in the Employment Tribunal claiming that they are workers and that case is yet to be heard.
The Deliveroo decision highlights that whether or not a person can be considered a worker very much comes down to the facts in each given case and whether the contract truly represents the reality of the arrangement. Deliveroo changed its practices earlier in the year so they had far less control over their riders and significantly relaxed their position on the riders’ right to appoint a substitute. Those changes appear to have stood them in good stead and organisations involved in the gig economy may wish to read the decision to see how their own practices fair in comparison.If you would like to discuss any issues raised in this article, we have specific employment law expertise in advising in this area. For further advice, please contact Angela Gorton or a member of the Employment Team.
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.