Deliveroo was today defeated in the High Court in a battle over whether the food delivery firm’s are self-employed or staff.
The Independent Workers Union of Great Britain has overturned a ruling which confirmed the ‘self-employed’ status of those working for the delivery firm.
The decision made in London is another blow for Britain’s gig economy that employs 5million people in Britain.
Deliveroo’s defeat came two days after Pimlico Plumbers lost their Supreme Court battle to stop a self-employed gas engineer getting treated as an employee with perks including sick and holiday pay.
Deliveroo previously claimed a victory following the ruling by the Central Arbitration Committee (CAC), which considers union recognition and collective bargaining cases.
The CAC rejected an application by the IWGB to represent drivers in parts of north London.
The committee concluded that because riders are able to pass on a job to a substitute, or to abandon a job, they were not obliged to provide a ‘personal service’ and therefore could not be classified as ‘workers’.
Mrs Justice Simler will announce on Friday whether the union will be given permission for a full judicial review of the decision.
Speaking after the CAC ruling last November, Dan Warne, Deliveroo’s managing director for the UK and Ireland, said: ‘This is a victory for all riders who have continuously told us that flexibility is what they value most about working with Deliveroo.
‘We welcome the decision of the committee. As we have consistently argued, our riders value the flexibility that self-employment provides.’
Mr Warne said at the time that the firm wants a change in employment law so it could offer benefits such as sick pay to its riders, whilst maintaining that flexibility.
The status of those working in the gig economy has been at the centre of a number of cases to have reached the courts in recent months.
Taxi firm Uber lost an appeal in November against an employment tribunal ruling on the status of employees, after two drivers argued they were ‘workers’ and entitled to the minimum wage, sick pay and paid leave.
Uber announced it will appeal, saying almost all taxi and private hire drivers have been self-employed for decades, long before its app existed.
The Supreme Court delivered a judgment on Wednesday in a landmark case brought by Pimlico Plumbers.
The firm lost its appeal against a number of court rulings which determined plumber Gary Smith could claim ‘worker’ status – even though he was described as ‘self-employed operator’ in his contract.
IWGB general secretary Dr Jason Moyer-Lee said: ‘Out of all the recent high-profile workers’ rights cases in the so-called gig economy, Deliveroo is the only company which has successfully deployed legal shenanigans to deny its workers their rights.
‘But a business model based on overzealous lawyers and legal loopholes is not sustainable.
‘The IWGB will continue to take action until it successfully secures basic employment rights for Deliveroo riders.’
Crowdfunding for the legal costs of the case has reached £23,000 so far.