Uber, Deliveroo and CitySprint: gig economy under the spotlight
November 2017 has seen the rapid-fire delivery of three UK judgments on employment status in the gig economy. Click on the case names in bold for case reports.
Uber has lost its appeal in the UK Employment Appeal Tribunal (EAT), the EAT confirming that Uber drivers are workers. Uber drivers are therefore eligible for the benefits afforded to them by UK employment legislation.
Lady Justice Eady dismissed Uber’s appeal noting:
“Having rejected the characterisation of the relevant relationships, on its findings as to the factual reality of the situation, the [Employment Tribunal] was entitled to conclude there was a contract between [Uber] and the drivers whereby the drivers personally undertook work for [Uber] as part of its business of providing transportation services to passengers in the London area”.
Note: “the drivers personally undertook work”.
See our notes on Deliveroo below, in which it was held that the couriers did not agree to “personally provide work” for Deliveroo.
Days later the Central Arbitration Committee (CAC) ruled that Deliveroo’s couriers are self-employed people rather than workers.
The case was brought against Deliveroo by the Independent Workers of Great Britain (IWGB) which sought union recognition for Deliveroo riders.
Under the Trade Union and Labour Relations (Consolidation) Act 1992, a trade union must consist “wholly or mainly of workers”.
In order to fall within the classification of a “worker” (s.296 of the TULR(C)A):
(1) The individual must be working under a contract;
(2) Under the contract, the individual must agree to personally provide work for the employer; and
(3) The employer must not be a client or customer of the profession or business undertaking carried on by the individual.
In its ruling, the CAC stated that:
“The central and insuperable difficulty for [IWGB] is that we find that the substitution right to be genuine, in the sense that Deliveroo have decided in the new contract that riders have a right to substitute themselves both before and after they have accepted a particular job; and we have also heard evidence, that we accepted, of it being operated in practice.”
The CAC said that this finding was “fatal to [IWGB’s] claim.”
As found by the CAC, if a rider accepted a particular delivery, the rider’s obligation was to do it himself or to get someone else to do it using a rider support team.
A rider was not penalised for not doing a delivery personally, provided the substitute complied with the contractual terms that applied to the original rider.
IWGB’s claim therefore failed part two of the test above as Deliveroo couriers did not agree to “personally provide work” for the business.
Hot on the heels of the Uber and Deliveroo decisions came the CitySprint announcement that they were not going to challenge the Employment Tribunal’s finding that its couriers were workers (with associated worker rights) rather than “self-employed freelancers”.
Rather than agreeing to provide basic worker rights in light of the decision, CitySprint will change its courier contracts.
CitySprint has been accused of delivering “a slap in the face” to the British legal system in taking this course of action, in the aim of circumventing the effects of the earlier tribunal ruling, rather than providing the minimum wage and holiday pay.
Uber have indicated that they will launch another appeal, while Deliveroo now faces a further legal challenge in the Employment Tribunal.
The Supreme Court will hear the final appeal in the similar case brought against Pimlico Plumbers in 2018.
We will keep you updated. Please do not hesitate to contact us if you have any questions.