Deliveroo tribunal victory provides UK GIG economy firms with way 'game the system'

A UK tribunal ruling that Deliveroo couriers are ‘self-employed’ rather than ‘workers’ could offer gig economy firms a means of maintaining current business models .

A surprise UK tribunal ruling that couriers for a popular food delivery business are ‘self-employed’ rather than ‘workers’ has offered gig economy firms a potential workaround to protect their business models.

The Central Arbitration Committee (CAC), a government body that oversees the regulation of UK labour law relating to trade union recognition and collective bargaining, has ruled that Deliveroo riders are technically self-employed as they have the right to allocate a substitute to do their work for them. This situation appeared to shift the balance in favour of self-employment as, in the CAC’s eyes, it gives couriers more control over their working conditions.

Other factors understood to be central to the decision were that the company removed performance monitoring and a requirement for riders to wear its branded clothing.

The case was brought by the Independent Workers Union of Great Britain (IWUGB) after Deliveroo, which introduced its contractual changes only weeks before the hearing, refused to recognise it as representing the couriers. The Union is now entitled to take the ruling to judicial review.

The findings came as a surprise after an Employment Appeal Tribunal recently found that drivers of the ride hailing service Uber were ‘workers’ – and therefore entitled to employment rights such as the national minimum wage and holiday pay. The Deliveroo ruling, like a string of others recently, was widely expected to follow suit.

But Aron Pope, employment partner at law firm Fox Williams, told the Chartered Institute of Personnel and Development’s People Management publication, that the case was different from other gig economy ones in that it rested on the nature of the employment contract rather than what happened in practice.

As a result, the ruling would “help gig economy companies implement structures that show drivers are genuinely self-employed”, he said. In other words, they would be looking at how they could amend their own employment contracts to implement the CAC’s findings.

But the IWUGB’s general secretary Dr Jason Moyer-Lee pointed out that the ruling would deny Deliveroo riders their desired workers’ rights and union recognition. “It seems that after a series of defeats, finally a so-called gig economy company has found a way to game the system,” he said.