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Farrer & Co | Uber 0 – Deliveroo 1: a game of two halves

In the last week two major players in the so called "gig economy" experienced differing fortunes on the issue of the status of their staff.

Uber lined up first.

As Katie Lancaster reported back in October 2016 (see her previous blog here), the Employment Tribunal previously held that Uber's drivers were workers and therefore entitled to basic rights, such as the national minimum wage and paid leave. Uber subsequently appealed this ruling and the Employment Appeal Tribunal published its judgment last Friday (the judgment can be found here). Somewhat less theatrically than the Tribunal at first instance, Her Honour Judge Eady QC rejected Uber's appeal and agreed that the drivers were indeed workers. In doing so, she cited a number of supporting factors, such as:

(i) the fact that, when the drivers had switched on the app, they had to be "able and willing to accept assignments";

(ii) they were required to accept "at least 80% of trip requests";

(iii) they would be penalised if they did not carry out a journey they had accepted.

Whilst the agreements between the drivers and Uber said different, Her Honour Judge Eady QC made plain (as is well established) that it is necessary to "determine what was the true agreement between the parties".

We must now wait to see whether Uber will appeal the EAT's decision. However, given the implications of the decision on what is a huge operation (Uber was reported in the judgment to have some 30,000 drivers), it is highly likely that they will appeal. If they do, we can also expect their appeal to leapfrog the Court of Appeal and be joined with Pimlico Plumbers' appeal against similar findings, which is due to be heard by the Supreme Court next year.

After Uber's defeat, Deliveroo then took to the field.

The decision in the Uber case was consistent with the decisions in a steady flow of "gig economy" cases over the last 12 months or so (involving, for example, in addition to Uber, Pimlico Plumbers, Citysprint and Addison Lee). However, perhaps surprisingly, the gig economy finally notched up its own victory this week following a decision of the Central Arbitration Committee.

The Independent Worker's Union of Great Britain ("IWGB") were seeking trade union recognition for Deliveroo riders in the "Camden Zone" and, as part of their application, were required to show that they consisted wholly or mainly of "workers". It may be that the IWGB believed this to be a quicker (and possibly less expensive) way of testing the status of the riders. However, if this is the case, it backfired, with the CAC ruling, having examined the reality of the true agreement between the parties, that the riders were not workers as they had a genuine right to appoint a substitute to ride in their place (whether or not that substitute was also an approved Deliveroo rider), both before and having accepted a particular assignment. As a result, the requirement to provide personal service, which is an important element of worker status, was deemed not to be present and the riders were found not to be workers.

Certainly from the CAC's perspective, it seems that a genuine substitution clause will offer a potential escape route for firms within the gig economy. That said, there are probably few firms who could operate, from a practical perspective, with such a wide ranging substitution provision as Deliveroo. Uber, for example, would presumably not be able to do so, given licencing, insurance and safety requirements.

In the meantime, we will have to wait until next year to see whether Uber, ably supported by star striker Dinah Rose QC, can score a late winner in the Supreme Court. For what it's worth and notwithstanding Dinah Rose QC's reputation, personally I would be surprised if they do.

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