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Deliveroo Loses Unfair Dismissal case – Drivers are Employees, not Independent Contractors.

Updated: Apr 26, 2022

The Fair Work Commission has found in favour of a former delivery driver of the international food delivery company Deliveroo, which held he was an employee, not an independent contractor as alleged by the company.

In the decision, Commissioner Cambridge held there were various factors which indicated the applicant was an employee of Deliveroo, including:

1. The degree of control exercised over the employee:

The significant data, metrics, and other digital advancements Deliveroo uses means Deliveroo could control when, where and for how long the applicant chose to work. This is indicative of an employment relationship. Further, Deliveroo had many means of disciplining the driver, which also suggested the applicant was an employee.

2. Work performed for competitors not critical:

Although Deliveroo allowed the applicant to work for various competitors, this “multi-applying” arrangement was an example of the impact technological change is having on traditional employment arrangements, rather than an indication the worker was an independent contractor.

3. Terms and Terminology of Supply/Supplier Agreements:

Although the agreement between the parties classified the relationship as one of principal and independent contractor, the evidence suggested the applicant had no capacity to negotiate the terms of the agreement and there were many provisions similar substance and form to those found in employment contracts.

4. Personal Service:

While Deliveroo did allow the applicant to delegate work, there was no evidence that the applicant actually did so. Further, there were clear financial constraints on the applicant’s ability to delegate as any attempt by the applicant to delegate work to another person would have been frustrated by his inability to pay them the minimum wage.

5. Presentation as part of Deliveroo:

Despite the fact it was not a requirement to wear the Deliveroo uniform, Deliveroo established an expectation for the applicant to wear Deliveroo branded attire and present himself to the world as part of the Deliveroo business.

Deliveroo has indicated its intention to appeal the decision.

The judgment demonstrates that an employer’s classification of a worker as an independent contractor in their written agreements does not mean a worker is not actually an employee. The relationship is always determined by the individual features of the relationship.

The decision also highlights the Court’s willingness to recognise the changes to the employment landscape because of the COVID-19 pandemic and the way new technology is challenging the traditional employment relationship models.

If you need any advice about how this decision may affect your business or wish to understand what your lawful entitlements are, feel free to contact a member of our employment law team.

John Sneddon, Partner (07) 3307 4504

Ruby Nielsen, Senior Associate (07) 3307 4551

Emma Lewis, Solicitor (07) 3307 4546

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