The Court of Appeal recently confirmed that riders for food delivery firm Deliveroo should be treated as self-employed. It dismissed an appeal from the Independent Workers’ Union of Great Britain (IWGB) which was seeking to have Deliveroo riders treated with the same legal status as employees.
untied's Jonathan Yeomans, says:
"There are various factors that determine whether someone can be treated as employed or self-employed, and this isn’t always clear cut. Ultimately, the responsibility for determining the correct employment status rests with the business engaging the worker. It’s important to correctly determine this status because the tax and national insurance treatment is different for employees and the self-employed. If this court decision had gone the other way it might well have had wider reaching tax implications."
Ability to provide a replacement to do work
"A key factor is whether or not the person has the freedom to provide someone else in their place to do their work – and this is something that HMRC looks closely at. Where a person doesn’t have to personally perform their services, then the relationship is not usually one of an employer/employee.
"In this judgement, and the earlier related cases, the court looked at the right of Deliveroo riders to use substitutes. It found the fact that they had the freedom to do this was key to determining their status as self-employed."
"This court judgement adds further certainty for Deliveroo riders and gives them confidence that they are correct to organise their tax affairs in the same way as other self-employed individuals. This status also brings a wider freedom for claiming certain business costs as expenses for tax purposes.
"There has been some confusion around this for workers in the expanding gig economy, especially since a court decision earlier this year which found that Uber drivers were workers and not self-employed. However, as untied pointed out at the time, that case was an employment law matter looking at the driver’s rights and not at their tax status. The circumstances of the relationship between Uber and their drivers also didn’t necessarily reflect the status of other workers in the wider gig economy."
Deliveroo riders now have certainty and confidence about their status as self-employed
"Commenting on the Deliveroo case last week, Lord Justice Coulson agreed that the Uber court decision in February 2021 was not relevant to the Deliveroo riders situation.
"Deliveroo riders can now have certainty and confidence about their status as self-employed, as this treatment has been tested by the UK courts on a number of occasions."
untied can help any Deliveroo riders or other gig workers who need help with their tax affairs. untied has guidance available which helps answer tax queries for workers in this area.
For further information:
Chantal Heckford firstname.lastname@example.org