There are two distinct threads running through the Supreme Court’s latest employment-related judgment which was published last week. The first is its reasoning on what an “employment relationship” means for the purposes of Article 11 of the European Human Rights Convention. The second is its commentary – largely in passing – on the relevance of its earlier landmark ruling in the Uber litigation which was published in 2021.
The warp through which these threads are woven comprises some unusual facts about the claimant riders’ contractual terms. Shortly before the hearing in front of the Central Arbitration Committee – when the riders sought to establish that they were “workers” for the purposes of our compulsory union recognition legislation – Deliveroo made some significant changes to these terms. They included the introduction of a “substitution clause” which allowed riders to allocate their delivery slots to other riders without needing to ask Deliveroo for permission, though certain safeguards applied. There were also additional changes which resulted in Deliveroo relinquishing control over other aspects of the service, including removing a requirement for the riders to wear an item branded with Deliveroo’s livery. The CAC agreed to base its ruling on these new terms.
It was arguable that the new terms had been introduced wholly or partly to defeat the riders’ claim. But that didn’t prevent the CAC from deciding, in November 2017, that they did not qualify as workers. This was largely because it was satisfied that the new substitution arrangements were genuine and had changed the way the services were delivered. It also rejected the riders’ alternative argument that they were in an “employment relationship” with Deliveroo for the purposes of article 11 of the Convention.
The riders were granted permission to challenge this ruling in 2018 – still well before the Supreme Court’s judgment in Uber – but only in relation to the CAC’s decision on the scope of article 11. Since then both the High Court (2018) and the Court of Appeal (2021) have dismissed the riders’ challenge. When the litigation finally reached the Supreme Court, their legal team conceded that they couldn’t rely on Uber to widen the scope of the appeal. In that light, it was not surprising that the Supreme Court reached the conclusion that the appeal should be dismissed.
If one ignores the legal route which the drivers had to take to get to the Supreme Court, and goes straight to the final outcome, this ruling appears to be an outlier compared to most other recent cases involving the gig economy, especially Uber. That is why the legal community were interested to see whether the Supreme Court was going to drop any hints that, had Uber been decided before the CAC’s ruling, it could or should have reached a different conclusion.
The short answer is that we are still unsure. The nearest we get to an answer is where the Supreme Court describes Uber and the employment status cases that preceded it as “instructive”, despite being decided in a different legal context. That was because they focused on the “reality of the situation” and how the contract “operates in practice”.
One could therefore draw the conclusion – in any context in which employment status is relevant – that organisations can still organise their business in a way that negates worker status for the individuals they engage, provided these arrangements are genuine and reflect the reality on the ground. One lesson of Deliveroo is that such arrangements – if they are to survive the increased scrutiny to which they will now be subjected - may involve compromises in terms of brand recognition and customer experience.
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