Deliveroo and Uber gig workers – Two sides of the same coin?
The explosive growth of the platform-enabled gig economy has been both celebrated and condemned. Multinational platforms like Uber, Deliveroo and TaskRabbit have become symbolic of flexible, non-committal working arrangements whereby independent contractors have the freedom to choose what work to perform, as well as when, where, and how. However, in recent years, a darker side of the gig economy has come to light, highlighting concerns about low and insecure income, algorithmic control, and a lack of employment protections for workers. Indeed, recent litigation has challenged the highly debatable notion that gig workers are self-employed and thereby not entitled to statutory employment protections like minimum wage, holiday pay, and the right to unionise. In February 2021 Uber lost this debate in the Supreme Court, whereas last June, the Court of Appeal ruled in favour of Deliveroo.
So why are gig-ers dropping people off considered workers but those delivering food are self-employed? - Significantly, what does this mean for worker’s rights?
Let’s start by going back to the basics. In the UK, there are three distinct employment categories: employees, who are guaranteed strong employment rights and protections, workers, who are entitled to some but not all of these rights, and the self-employed, who enjoy none of these protections. Both Uber and Deliveroo consider their drivers and riders to be self-employed.
In 2016, a group of twenty-six ex-Uber drivers first took the ride-hailing company to the Employment Tribunal, asserting that this was the incorrect status and that they should be treated as workers instead. Uber insisted that they are merely an intermediary booking platform, and holding otherwise would be contrary to the written Services Agreement signed by drivers, which clearly states that Uber does not employ its drivers. The Supreme Court (SC) clarified that what counts is less the words of a non-negotiable agreement between two parties of unequal bargaining power, and more the actual circumstances in which the work is performed. It is according to the latter that the legislation, designed to protect vulnerable individuals in subordinate and dependent positions, is applied. The Court otherwise described this as a purposive approach to statutory interpretation. Indeed, based on the following five factors, the SC concluded that these drivers are in fact, workers.
Drivers cannot determine fare prices.
Uber dictates the service agreement terms.
Drivers are in a subordinate position to Uber, as their acceptance rates are closely monitored and if they fall below a determined threshold, they are automatically logged out of the app.
Uber exercises a significant degree of control over the delivery of rides by their drivers, as evidenced by their use of customer ratings systems as an internal performance management tool.
Communication between driver and rider is purposely restricted to discourage future commercial relationships between the parties, thereby disabling drivers from building a loyal customer base like the typically self-employed could.
This can be compared to the case of Deliveroo riders, which the Court of Appeal confirmed to be self-employed.
For years, the Independent Workers Union of Great Britain (IWGB) have tried and failed to secure union rights for Deliveroo riders because this requires a worker rather than self-employed status. The latest Court of Appeal decision is the fourth decision in the UK to side with Deliveroo’s assertion that its riders are indeed self-employed. The material difference with Uber drivers is that Deliveroo riders have a right to substitution, meaning they are under no obligation to perform the work personally. Contrary to the IWGB’s argument, it does not matter how often this right is exercised, as long as it is “genuine” and “unfettered”; which it is held as in this case. This contrasts with the substitution clause in Autoclenz Ltd v Belcher (2011) UKSC 41, which the SC found to be a “sham”.
Key take-aways
The consequences of these rulings are significant for the drivers and riders of Uber and Deliveroo. Indeed, although the Uber decision technically applied to the original twenty-six claimants only, it pushed Uber to award minimum wage and holiday pay to all of its drivers. For Deliveroo drivers, unless the IWGB appeals to and wins in the Supreme Court, they do not have bargaining rights and remain subject to the challenges of the labour market. The cases have wider knock-on effects on the gig-economy as a whole as well. Here are some key take-aways:
🡪 Although the cases are based on and set strong precedents, gig economy litigation is extremely fact sensitive. Not all platform work is created equal, and every company operates in slightly different ways. Therefore, the devil really is in the detail!
🡪 It is less about the terms of a written agreement and more about the realities of the actual working arrangements.
🡪 Convoluted written agreements that giggers have no choice but to sign do not impress judges much. Instead, their purposive approach to statutory interpretation allows them to go beyond the individual terms and look at the reality of the true working arrangements.
🡪 Genuine rights to substitution are clear indicators of self-employment.
🡪 Greater and more equitable protections of gig-economy workers is needed. The UK Government has yet to implement the 2017 Taylor Review on the matter. The European Commission is due to draft new legislation and common standards of work for the sector by the end of the year.
