News

07th March 2017

Deliveroo Riders' Employment Status to be decided by Tribunal

The employment status of Deliveroo riders will be determined by a tribunal at the end of May, after another ruling that affects the rights of workers employed in the gig economy. 

The UK’s gig economy allows for employees to make their working lives flexible “gigs” rather than a full time, fixed salary occupation. Whilst this paves the way for innovation, exciting economies and entrepreneurialism, the gig economy can also provide reasoning for some firms to exploit workers with very little work place protection and few rights. 

Following a bid to unionise London, The Central Arbitration Committee will investigate whether Deliveroo’s riders are workers or independent contactors. 

The case has been prompted by The Independent Workers’ Union of Great Britain (IWGB) wanting to represent the riders as a statutory union, raising concern over deliveroo’s labelling of workers as independent contractors. 

If the tribunal rules that Deliveroo couriers are not independent contractors but workers, the company may be forced to give employees statutory benefits such as minimum wage, sick pay and paid holiday. 

Jason Moyer-Lee, IWGB General Secretary, commented on the issue stating: "For years employers in the so-called gig economy have been able to get away with unlawfully depriving their workers of employment rights to which they are legally entitled. In this tribunal hearing we intend to expose Deliveroo's sham operations and force them to finally reckon with the rule of law." 

Until last month, riders had been banned from taking the company to tribunal following a controversial clause in their employment contracts. Deliveroo recently agreed to remove the clause blocking riders from disputing their status but with the tribunal due to take place on May 24th, the firm may face a severe backlash with complaints from many of their riders. 

The tribunal comes as the House of Commons' Business, Energy and Industrial Strategy Committee starts an inquiry into the legal and tax issues related to employment in the gig economy. The aim of the inquiry is to focus on how workers in the industry can be protected. 

The news comes following other high profile rulings against the likes of Pimlico Plumbers and Uber. Last October UK drivers won the right to be classed as Uber workers and not independent contractors, with Uber now appealing the decision. 

Separate to the case, The IWGB has urged Deliveroo to increase its price per drop-off from £4 to £5, in a campaign supported by Shadow Chancellor John McDonnell and Green MP Caroline Lucas. The IWGB has also requested  Deliveroo consider imposing a hiring freeze in Brighton after the number of riders in the area has reached such a peak, many are earning below minimum wage. 

A Spokesperson from Deliveroo has released a statement saying:  "We are proud to offer flexible work to 15,000 people in the UK. The IWGB do not accurately represent the vast majority of our riders who overwhelmingly support the flexibility and good pay which comes with being self employed.That is no doubt why the IWGB is seeking recognition in just one small part of London. We look forward to engaging with the Central Arbitration Committee’s hearing as they assess the credibility of the IWGB’s claim."

Deborah Scales, Head of Employment at Cartwright King Solicitors comments:

“Since the high profile Uber case, the phrase ‘gig economy’ has become synonymous with relatively low paid, low skilled occupations. Employment tribunals have found that claimants were given ‘sham’ contracts by the employer who made out the individuals were in business on their own account. 

"In reality they were ‘workers’, largely because of the degree of control the companies exerted over them, and so entitled to a number of employment rights. This includes the national minimum wage, holiday pay, working time rights and protection from unauthorised deduction of wages. 

"Businesses need to protect themselves by putting reasonable ‘restraint of trade’ clauses in their contracts with employees and contractors, which have a decent chance of being enforced by the courts if that becomes necessary to business’ survival”.

If you would like expert legal advice on employment law issues please contact us on 0808 168 5550 or at info@cartwrightking.co.uk.

 

For further information please get in touch with our dedicated team.

You can always call us on 0845 894 1622 or email on info@cartwrightking.co.uk

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