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80: Central Arbitration Committee rules that Deliveroo riders are not workers

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80: Central Arbitration Committee rules that Deliveroo riders are not workers
Leave your thoughts Brian Gegg

By Brian Gegg

In Independent Workers’ Union of Great Britain (IWGB) v RooFoods Ltd (t/a Deliveroo), the Central Arbitration Committee (CAC) has considered the IWGB’s application to the CAC for statutory recognition in respect of Deliveroo’s riders in the Camden area.

Statutory recognition only entitles unions to conduct collective bargaining on behalf of ‘workers’ in the bargaining unit. Deliveroo argued that the IWGB’s application could not be accepted because the drivers are self-employed rather than workers.

Deliveroo is an app-based service which enables customers to order takeaway food from participating restaurants for delivery by cycle, scooter or motorcycle riders. Riders enter into non-negotiable supplier agreements with Deliveroo in which they are described as independent contractors. The agreement also states that riders can work for other organisations, including competitors; Deliveroo is under no obligation to provide work; and riders are not required to wear branded clothing. Riders supply their own transport and smartphone, and pay a refundable deposit of £150 for a supplier pack which includes a branded jacket, thermal box and bags to transport food. When logged into the Deliveroo app, riders can mark themselves as available or unavailable and can accept or decline jobs with no repercussions. The Camden riders are paid on a non-negotiable fee per delivery basis. Given that these factors point towards self-employment, the key question for the CAC was whether the riders are obliged to perform services personally.

Case law has shown that, where there is a genuine and unfettered right of substitution, the individual is not obliged to perform services personally and will therefore be classed as self-employed. Deliveroo’s contracts contain a number of provisions relating to substitution, including:

  • riders may provide a substitute, who may be employed or engaged directly by the rider, to perform the delivery. There is no need to obtain Deliveroo’s approval, or even inform them, unless the substitute is using a different vehicle type, which might affect delivery times;
  • it is the rider’s responsibility to ensure that the substitute has the necessary skills
    and training;
  • the substitute must either carry the rider’s phone or be given the rider’s login details so that they can log into the app to ensure the location of the delivery can be monitored;
  • the rider is responsible for a substitute’s performance; and
  • the rider is paid for the substitute’s work and any arrangements for paying the substitute are between the rider and their substitute.

Crucially, there was evidence of this right of substitution being used in practice, one Deliveroo rider having subcontracted work for a 15-20% share in the delivery fee. The CAC therefore concluded that the riders have a genuine and almost unfettered right of substitution and that since they are not obliged to provide personal service, they are not workers. The IWGB’s application for recognition was therefore rejected.

The facts in this case are very different to the Uber, Excel and CitySprint cases, where the main issue was the degree of control and subordination rather than whether there was an obligation to provide services personally. As this case illustrates, a right of substitution will usually be fatal to a claim for worker status. Although employers often include substitution clauses in contracts with service providers, this will not be sufficient to avoid a finding of worker status if the right to substitute is not genuine or cannot be exercised in practice.

22 January 2018

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