Deliveroo is not in an “employment relationship” with its riders and doesn’t have to engage with a union representing them, the Supreme Court has ruled.
Deliveroo’s lawyer said the decision brings “welcome certainty for platform economy companies with highly flexible operating models in which individuals have genuine freedom about whether and when to work”.
The ruling “brings to a conclusion” seven years of legal battles between Deliveroo and the Independent Workers’ Union of Great Britain (IWGB), which brought the case.
“The question of whether such persons are ‘workers’ under domestic law had long since been resolved in Deliveroo’s favour, and now arguments based on human rights law have been finally decided for the company as well,” said Colin Leckey, relationship partner for Deliveroo at Lewis Silkin, which represented Deliveroo.
Lord Lloyd-Jones and Lady Rose, who gave the lead judgment, determined that the “virtually unfettered… broad power of substitution” in riders’ agreements – which allows riders to appoint someone else to carry out deliveries – was “totally inconsistent with the existence of an obligation to provide personal service”, an inherent feature of an employment relationship.
Beyond the substitution clause in rider contracts, the fact that riders do not have to carry out deliveries at all; the absence of any specific hours; and the absence of any requirement for riders to be available at any time also provided “strong support” against there being an employment relationship with riders.
The IWGB was first refused permission to represent riders by labour law body the Central Arbitration Committee in 2017 on the basis they were not classed as “workers” under UK labour law.
The union since mounted several appeals, before its arguments reached the Supreme Court.
“As a union we cannot accept that thousands of riders should be working without key protections like the right to collective bargaining, and we will continue to make that case using all avenues available to us, including considering our options under international law,” the union said.
“Flexibility, including the option for account substitution, is no reason to strip workers of basic entitlements like fair pay and collective bargaining rights,” the IWGB added. “This dangerous false dichotomy between rights and flexibility is one that Deliveroo and other gig economy giants rely heavily upon in efforts to legitimise their exploitative business models.”
Earlier this month the Home Office urged food delivery firms to conduct checks on all delivery drivers to protect the British public, and prevent illegal working and end the practice of unchecked account sharing – or substitutions – by implementing stricter controls.
“When someone orders a takeaway to their home, they deserve to know the person arriving at their door has been properly vetted and is who they’re expecting,” said immigration minister Robert Jenrick.
Regarding substitutes, Deliveroo tells riders it is “your responsibility to make sure that this person meets all of the requirements to work with Deliveroo” such as being over 18 and legally permitted to work in the UK.
“Deliveroo operates a zero-tolerance policy towards anyone who fails to meet their obligations in relation to any substitute engaged by them,” the company says.
In 2022, Deliveroo and the GMB Union sealed a “first of its kind in the world” agreement giving rider members of GMB rights to collective bargaining on pay and consultation rights on benefits and other issues. The Trades Union Congress called it a “landmark” agreement that would “give Deliveroo riders a real voice at work”, but others – including the IWGB – called it “a hollow and cynical PR move”, accusing GMB of “claiming to represent [workers’] best interests but in fact signing away their basic rights”.
Deliveroo has faced legal challenges involving worker status and rights around the world, which have come at a serious financial cost, with Deliveroo revealing in its 2021 IPO prospectus that it had set aside more than £112m to cover potential legal costs in five countries. The company pulled out of Spain just months after the government there announced plans to give workers at food delivery companies more employment rights – but claimed it was not the determining factor in the move.
The legal team at Lewis Silkin representing Deliveroo at the Supreme Court included Tarun Tawakley, a former global head of employment at Deliveroo.