Employment and Immigration Law Update – Worker status: right of substitution
18 December 2019
The Employment Appeal Tribunal (EAT) has considered whether a delivery courier had correctly been categorised as a ‘worker’ despite the existence of a contractual right of substitution.
Stuart Delivery ltd v Augustine UKEAT /0219/18
Facts
This case concerns a courier who provided delivery services through the company’s app. Couriers engaged by the company provide both ‘ad hoc’ deliveries when they choose to accept a job via the app, as well as ‘slot’ deliveries during particular time brackets, which they sign up for in advance and ensures the company has couriers available at times of high demand. Those who signed up for a slot were guaranteed a minimum rate of pay per hour but had to remain in the relevant geographical zone and could only refuse one delivery during the slot. A courier could elect to release a slot he or she had already signed up for and make it available to other couriers to accept, but that courier remained liable for completing it if no-one else accepted it and faced sanctions for failing to do so.
The claimant brought a number of employment tribunal claims against the company, including for unauthorised deductions and holiday pay. The tribunal first had to determine whether the claimant was a ‘worker’ for the purposes of these claims. It held that the process for releasing a delivery slot did not amount to an unfettered right of substitution, which would otherwise allow for another person to carry out the deliveries. This meant that the claimant had an obligation of personal performance under the contract and was therefore properly categorised as a worker. The company appealed against the tribunal’s decision.
EAT decision
The EAT has dismissed the appeal and upheld the finding that the claimant was a worker. On the facts of the case, it agreed that the tribunal had been entitled to find that there was no right of substitution, or at least the right was a limited one. The claimant had no control over who (if anyone) would accept a released slot, and the company had the ability to withhold consent to any substitute courier since it controlled who was accepted into its pool.
Consequences
This decision illustrates how tribunals will take a sceptical view of any right of substitution included within contractual documentation between the parties, and will look very carefully at how the right actually works in practice. Businesses hoping to rely on the inclusion of a contractual right of substitution as evidence that an individual does not meet the requirements for ‘worker’ status will need to be able to demonstrate that the right of substitution is not subject to the consent of someone who has the absolute and unqualified discretion to withhold consent.
This article is from the December 2019 issue of Employment and Immigration Law Update, our monthly newsletter for HR professionals. To download the latest issue, please visit the newsletter section of our website.
The content of this article is for general information only. For further information please contact Liz Stevens or another member of Birketts’ Employment Law Team.
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Liz Stevens
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at December 2019.