Substitute clause means Deliveroo cyclists are ‘self-employed’

Deliveroo has won a dispute over whether its cyclists should be classed as workers or self-employed after inserting a ‘substitution’ clause into their contracts.

The issue arose after the Independent Workers’ Union of Great Britain (IWGB) claimed union recognition for Deliveroo cyclists in Camden in London. For the claim to succeed, the union had to show that cyclists constituted a bargaining unit of “workers”.

The case was heard by the Central Arbitration Committee (CAC), which adjudicates in union recognition cases.

Shortly before the hearing, Deliveroo sent its cyclists a letter telling them it had inserted a substitution clause into their contracts. This gave them “the ability to appoint another person to work on your behalf with Deliveroo at any time”. The letter also told them they could work for other firms, including competitors, while still working for Deliveroo.

The substitution clause was enough to make the CAC rule in favour of Deliveroo. The decision means the cyclists do not have to be classed as workers and so do not qualify for the rights that go with being a ‘worker,’ such as holiday pay or union representation.

Giving its ruling, the CAC said: “The central and insuperable difficulty for the union is that we find the substitution right to be genuine, in the sense that Deliveroo have decided in the new contract that riders have a right to substitute themselves both before and after they have accepted a particular job; and we have also heard evidence, that we accepted, of it being operated in practice.”

“In light of our central finding on substitution, it cannot be said that the riders undertake to do personally any work or services for another party. It is fatal to the union’s claim.”

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