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The Central Arbitration Committee (“CAC”), a United Kingdom judicial body with jurisdiction over union-related claims, decided in a collective conflict to consider Deliveroo riders as self-employed independent contractors instead of workers or employees (click here for the CAC decision).

The United Kingdom had been in the spotlight in recent months, due to the first judicial outcomes related to collaborative economy companies (GIG economy). Some companies changed their corporate structure based on these first outcomes, as the courts had decided that their riders are workers, and not self-employed independent contractors. This was the case with CitySprint and Pimlico Plumbers.

We clarified the difference between employees, workers and contractors in our blog when the Employment Appeal Tribunal issued its judgment on the contractual relationship between Uber and its drivers.

Contrary to Uber’s case, the CAC decided that Deliveroo’s riders are contractors. The keystone argument in this decision is the right to substitute riders.

The CAC decided that Deliveroo’s riders must be contractors, as they have the possibility to substitute themselves when delivering services. This right makes the service delivered by the rider a non-personal service. Employees or workers provide services in a personal way, and they cannot be substituted by others. This right was proven in court, as some riders used to take advantage of this right, although its use is not common. The CAC emphasized that the mere possibility of substitution without being penalized by the company makes the services non-personal and therefore determined that riders are contractors.

The tribunal also took into account that riders are not forced to accept orders, their time schedule is completely up to them, and they pay for their own work resources.

The CAC has clarified the difference between contractors, workers and employees under UK legislation. For GIG economy companies and their corporate and workforce structure, this decision draws a path on how to tackle the challenges they are facing.

Currently, the Spanish Labor Inspection is investigating Deliveroo’s relationship with its riders. The CAC decision may help Deliveroo to have a better legal standing.

 

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pedro.mendezdevigo@cuatrecasas.com

Socio

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Abogado del área laboral y de derecho deportivo del despacho desde 2004E experto en asesoramiento a grandes empresas en nuevas tecnologías y en litigios y práctica judicial.

valentin.garcia@cuatrecasas.com

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