Deliveroo, unions and the ‘gig economy’

Published: 15th Nov 2016

In brief

Claim

Deliveroo will have to recognise a union if over half the drivers in an area sign up to it.

Conclusion

That’s likely, but not completely guaranteed since the Central Arbitration Committee may decide that the drivers should hold a ballot on union representation anyway. The appointed panel would also have to decide that Deliveroo drivers are ‘workers’, not self-employed contractors.

On 7 November, the Independent Workers’ Union of Great Britain (IWGB) asked Deliveroo, an online food delivery company, to voluntarily recognise it as the trade union for Deliveroo drivers and riders who work in Camden.

The Independent reported:

“If half of drivers in the area sign up, the company will be forced to recognise the union; it will be the first collective bargaining agreement in the ‘gig economy’.”

The Independent, 8 November 2016

That’s likely, but not completely guaranteed since the Central Arbitration Committee (CAC) may decide that a ballot of drivers should still be held anyway. And the CAC would also have to decide that Deliveroo drivers were legally ‘workers’ employed by Deliveroo.

At the moment, Deliveroo says that its drivers are self-employed.

The CAC told us that when this kind of thing is disputed, the panel can ask to hear arguments from both sides. What matters is the reality of the employment relationship and whether that fits the legal definition of a ‘worker’, not the terms of the contract.

If the CAC decide that Deliveroo drivers are actually ‘workers’, then that implies that they are entitled to a range of basic protections like the National Minimum Wage and sick pay. As the IWGB’s general secretary put it, an application to form a trade union is, “another way of achieving a change in employment status”.

For the CAC to consider the application for trade union membership, the proposed ‘bargaining unit’ would have to include at least 10% of Camden drivers as members and be judged likely to have the approval of the majority of drivers in the area. 

Camden drivers would then have to show their support through a ballot, although the CAC may choose to bypass this stage if over 50% are union members.

Gig economy

The IWGB has said this would be the first collective bargaining agreement in the history of the so-called ‘gig economy’.

There’s no agreed definition for the gig economy, but it’s generally used to refer to low-paid, flexible work such as running errands (TaskRabbit), giving lifts (Uber) or delivery services (Deliveroo or Hermes), where people are offered piece-work through a website or app.

There’s a debate about whether workers who regularly take these contracts are really ‘self-employed’. Even if their contract says that they are, what matters legally is the reality of the working situation.

Critics have raised concerns about inadequate rates of pay, lack of emergency leave, complicated pay and bonus systems, and poor job security. An employment tribunal recently ruled that Uber drivers are ‘workers’, not self-employed contractors as their contracts stipulated. This gave them basic protections, although fewer than a contractual ‘employee’ would have.


Featured

Full Fact and international partners win Google AI Impact Challenge

We aim for our factchecks to be as accurate and up-to-date as possible. If you think we've made an error or missed some relevant information, please email team@fullfact.org.

Tweet

Share