Why the Deliveroo ruling against worker status is a ‘one-off’
21 November 2017
Last week, the Central Arbitration Committee (CAC) published a ruling on worker status that appears at first glance to go against the current trend of Employment Tribunal cases about worker status in the ‘gig economy’.
Terri Bethel, CIPP’s lead technical material author, provides this informative commentary:
Recent cases involving organisations such as Uber, Pimlico Plumbers and Addison Lee have ruled that the individuals using digital platforms to accept and carry out jobs on behalf of these organisations are workers entitled to employment rights such as holiday pay and minimum wage protection.
The CAC ruled that Deliveroo’s riders are not workers, but this case differs in various respects that mean it has little or no bearing on the direction of travel.
The main difference is that this is a worker recognition case, brought by the Independent Worker’s Union of Great Britain, which sought collective bargaining rights for a group of Deliveroo’s riders. The governing legislation is the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) rather than the Employment Rights Act 1996 (ERA), and applications for union recognition and collective bargaining rights are heard by the Central Arbitration Committee rather than Employment Tribunals. TULRCA contains a definition of a ‘worker’ that differs slightly from the definition in the ERA and each one of three determining questions must be met to achieve worker status, whereas employment case law has established that worker status depends on the balance of a number of determining factors.
The key question in this case was whether Deliveroo’s riders are obliged to undertake the work personally or have the right to substitute another person to undertake the work. Shortly before the first hearing in this case, Deliveroo added a substitution right to its contracts and was able to provide evidence to the CAC that this is a genuine right: riders can and do exercise the substitution right without penalties. The CAC therefore ruled that there is no obligation to undertake work personally, so the individuals are not workers and the union’s recognition case failed (there is no right of appeal).
An employment tribunal considering the same evidence might not come to the same result because it would be obliged to examine other relevant factors, such as management control, integration into the workforce, and so on, and determine the result on a balance of factors. Having the substitution right on its own would not prevent a ruling in favour of worker status. We may soon find out because a worker status case against Deliveroo began earlier in November at the Central London Employment Tribunal (the CAC ruling is not binding on Employment Tribunals).
As is often the situation with employment law cases, although two cases have now passed the Employment Appeal Tribunal stage and are theoretically binding on other Employment Tribunals, their appeals processes have not yet been exhausted, and some cases turn upon specific facts, so there is not yet any conclusion to this ongoing saga.
Deliveroo’s success in this worker recognition case is interesting but merely a diversion. What may be more significant is the Government’s response to the recommendations in the Taylor review published earlier this year; legislative changes may establish clearer rules and remove some of the variation between employment, tax and union recognition law.