Independent Workers Union of Great Britain v Central Arbitration Committee and another

The Supreme Court have handed down their judgement in the case of Independent Workers Union of Great Britain v Central Arbitration Committee and another. This judgement confirms that Deliveroo Riders were not in an "employment relationship" for the purposes of Article 11 of the European Convention of Human Right which means that the provisions of that Article which protects the right to form and join Trade Unions do not apply to them.

The link to the judgment is here.

What had happened prior to the case reaching the Supreme Court?

By way of background, the Deliveroo Riders who worked in a particular zone in London (CKT) joined the Independent Workers Union of Great Britain and wanted the Union to negotiate on their behalf to help improve the conditions under which they performed their services. Deliveroo refused to enter into collective bargaining negotiations with the Union which resulted in the Union making a formal request to Deliveroo to recognise it for Collective Bargaining in respect of those Riders in North London.

Deliveroo rejected the request and the Union therefore made an application to the Central Arbitration Committee (CAC). The CAC has the power to make an order for employers to recognise a Union and engage in collective bargaining provided certain condition are met. One of the conditions was that the people who the Union wishes to be recognised are "workers" within the meaning of the section 296 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULR(C)A). Deliveroo argued that the individuals were not workers within that definition and the CAC agreed.

The Union argued that refusal to recognise the Union for collective bargaining based on the definition of "worker" in the domestic legislation would constitute a breach of Article 11 of the European Convention of Human Rights (which protects the right to freedom of association and to form and join a trade union). They argued that the definition of "worker" in TULR(C)A should have been construed to give effect to Article 11. Permission to challenge the CAC's decision by way of Judicial Review was given on the Article 11 ground only (the Union had initially applied for a Judicial Review on five grounds). The Judicial Review was rejected by the High Court, which was appealed by the Union to the Court of Appeal who also came to the same conclusion. The Union therefore took their case to the Supreme Court.

Supreme Court's decision

Employment relationship

It was the view of the Supreme Court there was no such employment relationship. The Supreme Court found that the analysis by the courts and the detailed scrutiny by the CAC of the relationship between Deliveroo and the Riders had correctly focussed on the power to appoint a substitute. "The powers conferred on Riders under the new contract to appoint a substitute is virtually unfettered and… is not limited to other Deliveroo Drivers. As the CAC emphasised, it applies both before and after a Rider has agreed to make a delivery. Such a broad power of substitution is, on its face, totally inconsistent with the existence of an obligation to provide personal service which is essential to the existence of an employment relationship within article 11." The Supreme Court noted that the CAC had found that there was "no policing by Deliveroo of a Rider's use of a substitute and Riders would not be criticised or sanctioned for using a substitute despite the purposed freedom to do so…. It found that Deliveroo did not object to the practice of substitution by a Rider for profit or to Riders working simultaneously for competitors of Deliveroo."

The Supreme Court also pointed to some "further indicators" which it considered to be relevant when looking at the relationship between Deliveroo and the Riders when having regard to the factors set out in the International Labour Organisation Recommendation No.198. This states that the correct approach when assessing such a relationship is to focus on the practicalities of the relationship and how it operates in reality. These indicators were as follows:

• There is no protection from financial risk for Riders, whether in the form of insurance, guaranteed earnings or otherwise.

• There is no reimbursement for the cost of travel.

• There is no payment in kind such as food, lodging and transport.

• There is no entitlement to weekly rest and annual holidays.

• Deliveries are not necessarily or typically their sole or principle source of income. Even where they are, a "goodly proportion" may earn from Deliveroo's direct competitors, potentially by undertaking the competitor's work in preference.

• There is no periodic payment. Remuneration depends on whether Riders choose to make deliveries and how many they make.

• As regards tools, materials and machinery, all equipment is at the Riders' expense. Riders use their own cycles and mobile phones.

• They are not required to be available.

• Their activity is not of a particular duration, nor does it have a certain continuity. Riders start and stop when they choose.

• Riders do not work within specific working hours. They operate if and when they choose.

• Their place of work is not specified or agreed. They operate where they choose within the CKT zone.

• Riders do not have to carry out any deliveries at all.

The Supreme Court found that these factors, which "when taken in conjunction with the right of substitution", provided strong support to the conclusion that there was no employment relationship.

Compulsory collective bargaining

The Supreme Court also had to consider if the Riders had rights under Article 11, if these right required UK law to make Deliveroo engage in compulsory collective bargaining with the Union. As the first issue had been determined in favour of Deliveroo, there was no need to make a finding on this. However, the Court did go on to state that Article 11 did not create any right to compulsory collective bargaining. The Supreme Court stated that "there is nothing in the UK legislation to stop the Riders from forming their own Union or join the Union as they have done. There is also nothing to prevent Deliveroo from engaging in collective bargaining with the Union to seek to agree the terms and conditions applied to the Riders if they so choose. If Deliveroo voluntary negotiates with the Union and concludes a collective agreement, the terms of that agreement may be incorporated into the individual contracts between the Rider and the employer". However, the Supreme Court found that Article 11 did not require the UK to go beyond this current position and enact legislation conferring on Article 11 workers the right to require their "reluctant employer" to recognise and negotiate with the Union of their choice.

What are the implications of this judgement?

Whilst this case focussed on the narrow issues regarding collective bargaining in the UK, it is clear that the emphasis the Supreme Court placed on the substitution clause and it's use in practice means that it if there is a right of substitution which is genuine and "virtually unfettered", this will make it extremely difficult to establish an employment relationship. However, employment status can never be guaranteed, with each case being extremely fact specific. It is also clear from this case and others that courts will focus on the reality of each situation and will scrutinise this thoroughly. The judgement also means that companies will not be faced with Human Rights based challenges for compulsory collective bargaining under Article 11 of the European Convention on Human Rights, which had been unclear previously.