Worker Status and Union Recognition - The Deliveroo Judgment
For several years now, the gig economy has dominated both the headlines and the legal sector as court case succeeded court case over the status of those working for such companies as Pimlico Plumbers, CitySprint, Uber and Hermes.
Last month, the Court of Appeal delivered its judgment in the latest of these cases, the Independent Workers Union of Great Britain (IWGB) v the Central Arbitration Committee (CAC) on the status of Deliveroo riders.
The question was whether, as independent contractors, they were able to seek compulsory union recognition under the Right of Association in Article 11 of the European Convention on Human Rights (ECHR) and the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA).
The IWGB, which represents workers in the gig economy, applied to the CAC - under Schedule A1 of TULRCA - to be recognised by Deliveroo for collective bargaining in respect of a group of riders in its Camden & Kentish Town food delivery zone.
Under Article 11 of the ECHR, workers are able to collectively bargain with their employers, and seek official recognition of a trade union. Independent contractors have no such right. It was therefore in the interests of the riders and the IWGB union to obtain recognition as it would make their bargaining position significantly stronger.
What does Article 11 say?
Everyone has the right to freedom of peaceful assembly and to freedom of association with others, including the right to form and to join trade unions for the protection of his interests.
No restrictions shall be placed on the exercise of these rights other than such as are prescribed by law and are necessary in a democratic society in the interests of national security or public safety, for the prevention of disorder or crime, for the protection of health or morals or for the protection of the rights and freedoms of others. This article shall not prevent the imposition of lawful restrictions on the exercise of these rights by members of the armed forces, of the police or of the administration of the state. When applied to employment situations, it gives workers the right to union recognition and all the protections that go with that. But, in a non-employment situation, such as was the case with Deliveroo riders, that protection was less extensive. Riders could still associate and join a trade union, but that membership would not be as effective as it would be if there was official union recognition.
What is the Central Arbitration Committee?
The committee is an independent body with statutory powers. The committee encourages fair and efficient arrangements in the workplace by resolving collective disputes in England, Scotland and Wales, either by voluntary agreement or, if necessary, through a legal decision.
It is responsible for the following areas of dispute:
the statutory recognition of trade unions (the relevant area in this case)
the disclosure of information for collective bargaining
applications and complaints related to information and consultation arrangements
complaints about the level of involvement employees have in certain decisions covered by regulations related to European companies, cooperative societies and cross-border mergers
It also offers voluntary arbitration in collective disputes.
What did the CAC say?
Under Section 296 of TULRCA, the definition of ‘worker’ is someone who is:
under a contract of employment or
under any other contract where they undertake to do or perform personally any work or services for another party to the contract who is not a professional client of theirs
The key phrase here is “perform personally”. The CAC said that Deliveroo riders were independent contractors who had the right of substitution – that is, they could send someone else to do the work for them if they were unable to do so. Thus, there was no requirement on them to perform the role personally, and they fell into neither of the Section 296 categories as listed above. Nor would Article 11 of ECHR apply to them.
Following the CAC decision, the IWGB took its case to the High Court and finally the Court of Appeal.
The right of substitution
It is this factor that differentiates the Deliveroo case from the Uber case that was heard at the Supreme Court – the judgment was delivered earlier in 2021 and caused the reclassification by Uber of its private hire drivers as workers.
It is important to note that merely because the right of substitution appears in a contract, this does not always point to a finding of self-employed status. The case of Autoclenz Ltd v Belcher (2011) at the Supreme Court said that an employer could not rely on a substitution clause in an employment contract if there was evidence to show that it did not reflect the true arrangement between the parties and was, in effect, a sham for the sake of appearances.
The Court of Appeal’s decision
The Court of Appeal focussed its attention on whether the Deliveroo riders were covered by Article 11. It concluded that they were not. They were under no obligation to provide services personally and had a virtually unlimited right of substitution.
The IWGB had said that the right of substitution was exercised very rarely and that it should not therefore be a relevant factor in the deliberations on employment status, but the Court of Appeal disagreed; what mattered was not how often the right to substitution was exercised, but the fact that it existed, and could be exercised if relevant circumstances arose.
The Court of Appeal noted that there were other features of the relationship between Deliveroo and the riders which might also support the view that it was not an employment relationship for the purposes of Article 11. There was no reference to specific working hours of a particular duration and continuity and no requirement for the worker to be available – in fact, the riders did not have any obligation to accept work if they did not want to. In addition, the physical tools of the job - the phone and bike - were required to be provided by the rider.
Having delivered its judgment, the Court of Appeal was at pains to add that the Deliveroo case turned on a set of specific facts and that there might be other cases with different facts and arguments, where a different result could occur.