LONDON — Britain’s top court ruled Tuesday that riders for one of the country’s biggest meal delivery companies do not have collective bargaining rights because they are not employees, a decision that may have broad implications for the gig economy in the U.K.
The Supreme Court’s ruling came in a case filed by the Independent Workers Union of Great Britain, which had sought to represent riders who deliver takeout meals for Deliveroo, which competes with firms such as Uber Eats and Just Eat. When Deliveroo refused to negotiate, the union appealed, arguing that the company was violating rights guaranteed by the European Convention on Human Rights.
But the court ruled that the right to collective bargaining applies only when there is an “employment relationship” between the workers and the company. Deliveroo riders aren’t employees because their contract gives them the “virtually unfettered right” to pass deliveries on to someone else, the court said.
The ruling is a “very significant win for Deliveroo” as workers and companies spar over their rights in the gig economy, said Nick Hawkins, a partner at the U.K. law firm Knights.
While companies like Deliveroo have built their businesses on what they consider self-employed contractors, many car-service drivers, package couriers and delivery riders are now pushing to be recognized as employees as they seek better pay and working conditions.
“This will be a ruling that other gig economy business will have been watching closely, with no doubt some checking for the existence of substitution clauses in their contracts,” Hawkins said.
Deliveroo welcomed the decision, saying it confirmed lower court rulings that the company’s riders are self-employed.
“This is a positive judgment for Deliveroo riders, who value the flexibility that self-employed work offers,” the company said in a statement.
The union called the ruling a “disappointment.”
“Flexibility, including the option for account substitution, is no reason to strip workers of basic entitlements like fair pay and collective bargaining rights,″ the union said. “This dangerous false dichotomy between rights and flexibility is one that Deliveroo and other gig economy giants rely heavily upon in efforts to legitimize their exploitative business models.”