The recent ruling by an employment tribunal that two Uber drivers were workers and not self-employed contractors has sparked action in other businesses within the gig economy. The gig economy is based on a new premise where individuals are paid for 'gigs' they perform, such as delivering food, and offers flexibility for businesses and those serving them.
This week, Deliveroo (an online food delivery company which delivers food on behalf of restaurants nationwide) was also called into question about its employment practices and whether its riders should be treated as workers rather than self-employed contractors.
The company received a letter from the Independent Workers Union of Great Britain (IWGB) on behalf of its riders operating in the Camden zone for recognition for the Union to seek a collective bargaining agreement on behalf of the group of riders. Recognition by Deliveroo would mean that the company would have to enter into negotiations with the Union regarding employment rights including pay, holiday and other terms and conditions which employees, not self-employed contractors, would be entitled to.
Deliveroo has been given 10 days to respond and give voluntary recognition to the Union, but if the company fails to respond within the time frame, the Union will resort to legal procedures to obtain statutory recognition. It will do so by submitting an application to the Central Arbitration Committee (CAC) for a declaration that Deliveroo must engage with the Union for the purposes of collective bargaining.
This could pose significant issues for Deliveroo since any negotiations and agreements reached with the Camden riders are likely to be rolled out with its riders across the country. The company may need to consider whether or not its business in the current format is viable going forward if it is required to treat all of its riders as workers rather than contractors.
It will be interesting to see whether the same issue will arise in other businesses which operate in a similar way.
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