Employment status in the gig economy is regularly under scrutiny. In this case the Supreme Court held that riders working for Deliveroo were not workers so not entitled to collective bargaining of their terms. The riders were not covered by the right to form and join a trade union under Article 11 of the European Convention on Human Rights (ECHR). Upholding earlier decisions, the Court decided Deliveroo riders are not in an “employment relationship” with Deliveroo for the purposes of European human rights law. This judgment ends seven years of litigation involving Deliveroo riders and the Independent Workers Union of Great Britain (“IWGB”).
The Facts
Article 11 of the ECHR gives a qualified right to freedom of assembly and association. It includes the right to form and to join a trade unions. The European Court of Human Rights (ECtHR) has held that, for the purposes of Article 11, the right to form and join a trade union is dependent on the existence of an employment relationship.
Deliveroo riders worked under non-negotiable ‘supplier agreements’, which describe them as independent self-employed contractors. These agreements placed no obligation on Deliveroo to provide work, no obligation on the rider to be available at any time or to accept jobs, and freedom for the riders to provide a substitute at any time and without the need for approval by Deliveroo.
The IWGB asked Deliveroo to negotiate riders conditions of service. Deliveroo refused to.
In November 2016, the IWGB made a formal statutory request to Deliveroo to recognise it for collective bargaining in respect of the riders. Deliveroo rejected this request and the IWGB made an application to CAC. CAC is the quasi-judicial body which has the power to order an employer to recognise a union and engage in collective bargaining if certain conditions are met.
One of those conditions is that the people in respect of whom the union wishes to be recognised are "workers" within the meaning of TULRCA. Deliveroo denied the riders were workers and the CAC agreed. The CAC also rejected IWGB's alternative argument that a refusal to recognise the union for collective bargaining based on the definition of "worker" in the domestic legislation would constitute a breach of Article 11 of the European Convention on Human Rights ("the ECHR") because they are workers for the purposes of that article.
The High Court dismissed IWGB’s challenge to the CAC's decision and the Court of Appeal came to the same conclusion. The IWGB therefore took its case to the Supreme Court.
The Supreme Court's judgment
The Supreme Court found, consistent with international labour standards, that it had to focus on the practicalities of the relationship and how it operates in reality.
It found that the riders were not "in an employment relationship" with Deliveroo. The key factor was that they had a virtually unlimited right of substitution – “totally inconsistent” with there being an employment relationship – and the supplier agreements genuinely reflected the reality of the relationship. Other relevant factors were that:
- Deliveroo did not police a rider’s decision to use a substitute and riders would not be criticised or sanctioned for doing so.
- Deliveroo did not exercise its right to terminate riders' contracts for failing to accept a certain percentage of orders or to make themselves sufficiently available. The riders were free to work or not as convenient to them.
- Deliveroo did not object to riders working simultaneously for its competitors.
The Supreme Court also noted some additional factors that pointed away from an employment relationship, including that: all equipment was at the riders’ expense; they did not have specific working hours; their place of work was not specified or agreed; and they were not protected from financial risk.
The Supreme Court went on to find that, even if workers are in an employment relationship for the purposes of Article 11, the Article 11 right does not confer a right to compulsory collective bargaining. States have a wide margin of discretion in how they choose to protect trade union freedom and current UK legislation is not inconsistent with Article 11 rights.
What does this mean for employers?
Whilst this case was specific to its facts, the judgment is consistent with domestic law in reinforcing the key principle that a genuine and unfettered right of substitution will defeat a claim for employment or worker status.
It is also demonstrates the factors that should be taken into account when determining whether the human right to collectively bargain is engaged or not.
The judgment is also helpful in confirming who has trade union rights under Article 11 of the ECHR and that the Supreme Court considers that Article 11 does not create any right to compulsory collective bargaining. As the law stands, an employer is free to choose whether to recognise a trade union and, if so, which union it wishes to recognise. However, as the Supreme Court noted, the extent to which Article 11 includes a right to collective bargaining has evolved considerably over the years and so we will continue to keep an eye on developments in this area. This case is likely to have implications for the soon to be heard Supreme Court case of Mercer (on whether it is unlawful to discipline employees for organising or taking part in industrial action). Although they are about different issues the extent of the Article 11 right is a live issue in that case as it was in this one.
The IWGB has also said it is 'considering our options under international law' therefore this may not quite be the end of the line in this litigation.
