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Deliveroo: Court of Appeal finds riders are not in an employment relationship

15 July 2021

In a unanimous judgment, the Court of Appeal has found that Deliveroo riders are not in an "employment relationship" and so do not fall within the scope of the trade union freedom right under Article 11 of the European Convention on Human Rights. Read our review of the decision.

Background

The appeal in the case of the Independent Workers Union of Great Britain V Central Arbitration Committee and another related to collective bargaining rights in respect of Deliveroo riders. The Independent Workers Union of Great Britain ("IWGB") applied to the Central Arbitration Committee ("CAC") to be recognised by Deliveroo for collective bargaining in respect of a group of riders. In November 2017 the CAC rejected the application by IWGB on the grounds that the riders were not "workers" within the meaning of the Trade Union and Labour Relations (Consolidation) Act 1992 ("the Act").  Crucial to the rejection was the fact that the riders were not required to provide the services personally but were permitted the use of substitutes. 

IWGB challenged the decision of the CAC by way of judicial review, where the claim was again dismissed. 

IWGB appealed to the Court of Appeal.

The Court of Appeal 

Employment status 

Under the 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 perform personally 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."

IWGB argued that the Deliveroo riders fell within limb (b).  In order to fall within this limb it is essential that the worker should agree to perform work or services "personally" for the other party.  

Supplier Agreements 

The relationship between Deliveroo and its riders is governed by standard-form non-negotiable written "Supplier Agreements". Riders are described as independent contractors and have no obligation to be available at any particular time.  The agreement allows the riders to engage or employ a substitute without prior approval from Deliveroo.  

The decision 

The Court of Appeal unanimously dismissed IWGB's appeal.  

The Court considered two distinct questions:

(1)  Do the riders fall within the scope of the protection afforded by Article 11 as it relates to trade union freedom?

(2)  If so, does article 11 give IWGB the right to seek compulsory recognition in respect of them?

Question 1

With a focus on the virtually unlimited right of substitution, the Court of Appeal found that the CAC was entitled to conclude that there was no "employment relationship" for the purpose of Article 11.  The riders were under no obligation to provide services personally. The frequency with which the riders did in fact substitute was not considered to be a relevant factor, although it can help determine whether the right to substitute is genuine. The Court stated: "We are, necessarily, concerned with legal relationships, and any test other than what the parties' (genuine) rights and obligations are would be unacceptably uncertain".

Question 2

The second of the two questions does not arise as a result of the findings under question 1. However, the Court of Appeal went on to say that if they were wrong about whether the riders were within scope of the trade union freedom right Article 11, it would not necessarily follow that that freedom entails the right to seek compulsory recognition - acknowledging that governments have a wide margin of appreciation when deciding which worker unions should be entitled to compel recognition.  

Comment 

Yet again the Courts have confirmed that personal service is a fundamental piece of the jigsaw when determining employment status. The unfettered right to substitute another person to do the work or perform the services is inconsistent with an undertaking to provide personal services.  

The decision of the Court of Appeal has bucked the recent trend in case law where worker status has been the predominant finding. However, the Court did note that this case was fact specific and that other cases, with different facts, may have a broader range of available arguments resulting in a different decision.  

Further Reading