No personal service, no employment

The Supreme Court has rejected a claim from the Independent Workers Union of Great Britain (the “IWGB”) that Deliveroo riders are in an “employment relationship” for the purpose of trade union rights conferred by article 11 of the European Convention of Human Rights: Independent Workers Union of Great Britain v Central Arbitration Committee [2023] UKSC 43.

The Supreme Court confirmed that personal service is an essential feature of the concept of an “employment relationship” under ECHR law. The broad right to substitute, as contained in the supplier agreements between the riders and Deliveroo, meant that there was no obligation to provide personal service and therefore no employment relationship.

Background

Deliveroo riders work under non-negotiable “supplier agreements”, which describe the riders as independent contractors and state that there is no obligation on Deliveroo to provide work and no obligation on the rider to be available at any time or to accept jobs. The agreements also allow riders to provide a substitute without needing approval.

The Trade Union and Labour Relations (Consolidation) Act 1992 provides a statutory mechanism for a trade union to seek recognition to conduct collective bargaining. A prerequisite of making a request is that it is made on behalf of a group of workers. In November 2016, IWGB applied to the Central Arbitration Committee under the statutory compulsory recognition procedures to be recognised for collective bargaining in respect of a group of Deliveroo riders. The application was rejected on the ground that the riders were not “workers” as they lacked the requisite personal service.

IWGB applied for judicial review. The only argument allowed to proceed was that the definition of a worker under domestic law should be interpreted to allow the Deliveroo riders to exercise their right to collective bargaining as protected by article 11 despite not meeting the requirement for personal service.

IWGB's case was dismissed by the High Court and Court of Appeal, so it appealed to the Supreme Court.

Supreme Court decision

The Supreme Court rejected IWGB's appeal that article 11 trade union rights should be construed purposively, and the argument that the Deliveroo riders were in a subordinate position with unequal bargaining power and as a result needed collective bargaining to set their terms and conditions.

The court noted that those who are entitled to benefit from and join a trade union under article 11 are those in an “employment relationship”. An employment relationship is an autonomous concept under article 11 and is distinct from domestic law.

Focusing on the obligation to provide work personally, the court held that this was an essential feature of an employment relationship under article 11, with the Deliveroo riders' virtually unfettered right to substitute (subject to not substituting any rider who had previously had their engagement terminated for misconduct) being decisive.

It also agreed that the following were other relevant factors pointing away from there being an employment relationship:

• Deliveroo did not police a rider's decision to use a substitute, and riders would not be sanctioned for doing so.
• Deliveroo did not terminate riders' contracts for failing to accept a certain percentage of orders or failing to make themselves sufficiently available, and riders were free to work (or not) as convenient to them.
• Deliveroo did not object to riders working simultaneously for competitors.
• All equipment was at the riders' expense.
• Their place of work was not specified or agreed.
• There was no periodic payment.
• The riders were not protected from financial risk.

Despite not being relevant for the Deliveroo riders, given the finding that they were not in an employment relationship, the court also addressed the scope of collective bargaining rights under article 11. It confirmed that article 11 does not include a right to compulsory collective bargaining, and it would not be a breach of article 11 for a state to decline to legislate for compulsory collective bargaining.

Implications

While the case goes against the trend in gig economy cases of individuals successfully challenging their employment status, it was nevertheless concerned with the narrow point of determining what constitutes an employment relationship for the purposes of article 11, rather than through the lens of domestic law. 

Although its general application may be limited, the decision is consistent with domestic case law to the extent that personal service is an essential feature of an employee or worker relationship:

• If there is an unfettered (unconditional) right to provide a substitute (i.e. the individual can choose anyone at any time to do the work in their place), there is no personal service (and so there can be no employment relationship).
• A conditional or limited right to provide a substitute may or may not be consistent with personal service, depending on the facts. For example, if the individual just has to show that their replacement is suitably qualified to do the work, this is likely to mean that there is no personal service. However, if the employer has an absolute right to withhold consent to someone else doing the work, this would be consistent with personal service and an employment relationship.
• If there is no right to provide a substitute, there will be personal service.

The IWGB has said that it is “considering our options under international law”. Whether that involves a claim against the Government in the European Court of Human Rights in Strasbourg for the final instalment remains to be seen.