Yahoo Finance Blow to gig economy workers after Deliveroo holiday pay ruling
Deliveroo has won a landmark case that means it does not have to give its riders holiday pay or the minimum wage.
Labour law body the Central Arbitration Committee ruled the delivery company couriers were self-employed – not, crucially, workers, in the eyes of employment law.
CAC found the riders were self-employed contractors because of their freedom to “substitute” – allowing other riders to take their place on a job.
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The CAC ruling said: “The central and insuperable difficulty for the union 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.”
It did, however, add: “There are clearly concerns about the precarious nature of the work and the wider debate around the gig economy.”
The case was brought by the Independent Workers Union of Great Britain (IWGB) on behalf of couriers in the Camden and Kentish Town districts of north London.
However, it was billed as having wider implications for the whole of the gig economy in establishing what rights people working for the likes of Deliveroo and Uber, among others, had.
CAC said its finding on the substitute aspect of the relationship between Deliveroo and its riders was “fatal to the union’s claim”.
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Dan Warne, managing director for Deliveroo in the UK and Ireland, said: “This is a victory for all riders who have continuously told us that flexibility is what they value most about working with Deliveroo.
“As we have consistently argued, our riders value the flexibility that self-employment provides. Riders enjoy being their own boss – having the freedom to choose when and where they work, and riding with other delivery companies at the same time.”
The IWGB said it was considering its next move but added the ruling did show Deliveroo riders were not satisfied with their current terms and conditions and wanted worker rights, including holiday pay and the minimum wage.
IWGB general secretary Dr Jason Moyer-Lee said: “On the basis of a new contract introduced by Deliveroo’s army of lawyers just weeks before the tribunal hearing, the CAC decided that because a rider can have a mate do a delivery for them, Deliveroo’s low paid workers are not entitled to basic protections.”
The case follows a number of claims brought by unions and workers in the gig economy seeking clarification on or definitive answers on employment rights.
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Last week, taxi hailing app company Uber lost an appeal against a landmark ruling on the employment rights of its drivers.
Two drivers, James Farrar and Yaseen Aslam, won a case last year after arguing they were workers and entitled to the minimum wage, sick pay, paid holiday and breaks.
Uber claimed the ruling could deprive drivers of the “personal flexibility they value” but lost its appeal at the Employment Appeal Tribunal in London.
