Tax & Legal 24 July, 2018

Deliveroo driver is not considered an employee

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Deliveroo driver is not considered an employee

A food delivery driver claimed to be employed by an employment contract with Deliveroo. The Amsterdam subdistrict court ruled that under Dutch law, this delivery driver could not be considered as a “pseudo self-employed worker”. What is this judgment based on and what should you take into account as an employer?

Deliveroo’s agreements with its delivery drivers

As of 1 November 2017, Deliveroo no longer offers cycle deliverers a fixed-term employment contract. From that date, bicycle deliverers can only work for Deliveroo as so-called “self-employed workers”. The contracts that Deliveroo offers its drivers are thereby – according to Deliveroo – contracts for self-employment, in which Deliveroo is defined as client and the former employee as “contractor”.

The question then is whether this is not just a way for Deliveroo as employer to save wages, tax and insurance premiums at the expense of couriers, as the couriers are dependent on one client, who effectively treats them as employees.

Agreements between employers and self-employed workers

Two key questions come into play in the type of claims that is at hand in this procedure:

  1. What have client and contractor agreed on?
  2. How are these agreements implemented in practice?

If the implementation of the agreements shows that the parties actually behave as employer and employee, Dutch law speaks of “pseudo self-employment”. Thereby, the determining factor is whether the delivery driver can be said to fall under the client’s authority or not. Authority means that the client determines how the work is to be performed.

It is important to know that this assessment may differ from case to case.

Assessment court independence

In this case, the court puts a lot of emphasis on the intention that the delivery driver and Deliveroo had when entering into their agreement. Agreements with freelancers usually contain all kinds of provisions that seem to be mainly intended to prevent the possibility of assuming an employment contract. For example, “Contractor may be replaced by another person.” Whether this is true in practice then remains to be seen. Precisely about these provisions that may be there mainly for form, the Court concludes: “The impression is rather that [plaintiff] knew what he was doing …”.

It is also striking that even when assessing how the parties gave effect to it, there is still a lot of emphasis on what was agreed in the text of the agreement. For example, the agreement states that the delivery driver can also work for other companies or have the delivery done by someone else. This is seen as evidence in favor of Deliveroo, regardless of the ambiguity as to whether it is used in practice.

The fact that under the agreement the delivery driver determines his own working hours and can refuse orders is seen as evidence of his independence. Similarly, the fact that prices cannot be negotiated (“fee per delivery”) is not seen as an indication that the delivery driver is an employee.

Finally, the court took into account that for this delivery driver the work for Deliveroo was a part-time job. The Amsterdam District Court ruled that these circumstances added up to prevent the delivery driver from being regarded as an employee. The court case was politically charged: the bicycle courier was supported in the case by the PvdA party in the Dutch Lower House and trade union CNV.

Prevent pseudo self-employment

A watertight employment contract is important for both employer and employee. It prevents ambiguity. Pseudo self-employment can also cost your company a lot of money and damage its reputation. Crowe Peak provides support to companies in the field of labor law, contracts and corporate law. Contact us for a no-obligation appointment.

Want to read more about pseudo self-employment? Read our more recent article here.

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