In line with previous case law, the Court of Appeal has held in Stuart Delivery Ltd v Augustine that a motorbike courier was a worker. The fact that Mr Augustine could release one of his slots to another courier did not amount to an unrestricted right of substitution and was not therefore inconsistent with the obligation on him to carry out his work personally.
Mr Augustine was a motorbike delivery courier for Stuart Delivery Ltd. In order to obtain work, he had to sign up to a time slot using the Staffomatic app and commit himself to being within a certain geographical location for 90 per cent of the time within that slot to qualify for a guaranteed minimum payment of £9 per hour. He would lose the guaranteed minimum hourly pay if he was not available for more than six minutes or refused more than one delivery job during the slot.
There was no reference to a right of substitution in the written contract. However, the company operated a system whereby Mr Augustine could release a slot he had signed up for back into the system. Another courier who had a contract with the company and had signed up to the app could offer to take up the slot that had been released. If no one was available, he had to work the slot himself. If he failed to take up two or more of his slots in a week, it would have an adverse impact on his courier performance rating, and he would not qualify for a bonus. Moreover, if his performance rating dropped below a certain average, he could be kicked off the app.
Mr Augustine brought a number of claims which required the tribunal to decide whether he was an employee, a worker, or a self-employed person.
Section 230(3) Employment Rights Act states that a worker is an individual who either (a) works under a contract of employment; or (b) “any other contract … whereby the individual undertakes to do or perform personally any work or services for another party to the contract…".
Tribunal and EAT decisions
The tribunal held that Mr Augustine was not an employee but that he was a worker as he had to carry out the work personally. The fact he could release a slot he had signed up to was not inconsistent with a requirement to provide personal service. This was because once he had signed up to the slot, he was obliged to perform the work personally otherwise there was a real risk he would face sanctions for not doing so. In particular, his ability to release a slot was dependent on another courier who was as equally qualified as him and was willing to take on his slot. If he could not find a substitute, he then had to carry out the work himself or face a financial penalty.
The EAT agreed with the tribunal that Mr Augustine was a worker (weekly LELR 658). As regards to the argument that he had the right to find a substitute, the EAT considered that in reality the company had ultimate control since only those couriers it had accepted into their pool could use the app to sign up for the slots Mr Augustine wished to relinquish. He had no control in terms of whether anyone would accept the slot he no longer wished to work. As such, the EAT considered that this did not amount to a right of substitution at all - it was more a right to hope that someone else might be available to work in his place.
Decision of Court of Appeal
Dismissing the appeal, the Court of Appeal agreed with the tribunal that the system set up by the company was intended to ensure that Mr Augustine himself turned up for the slots that he had signed up for and did the delivery work during those slots. Indeed, that system was necessary for the company’s business model to work. As the tribunal had pointed out, the limited right to notify other couriers via the app that Mr Augustine wished to release that slot in the hope that it would be taken up by other couriers "was not, in reality, sufficient right of substitution to remove from him that personal obligation to perform his work personally…".
That conclusion was also consistent with the decision in Pimlico Plumbers Ltd and anor v Smith (weekly LELR 581) in which the Supreme Court held that the tribunal was entitled to conclude that the dominant feature of the contract was an obligation of personal performance. The fact that Mr Smith was able to appoint a substitute from within the ranks of Pimlico operatives did not negate the fact that he had to carry out the job personally.
This case is another reminder that employers will not be able to rely on an argument that there is a right to provide a substitute to deny worker status to someone when the reality is that the employer has ultimate control of the substitute. In this case a system of rewards and penalties was clearly intended to make sure that the couriers worked the slots they had signed up for.