Employment Law Case Update – December 2023

As the year draws to a close we delve into some technical cases – an update on the case that just keeps on giving (Deliveroo), a look at how “heat of the moment” resignations play out and when they might be considered to have in fact been an unfair or wrongful dismissal, and how a tribunal got it wrong in not calling out a respondent’s alleged dishonesty.

  • Worker Status: Supreme Court unanimously agrees that Deliveroo riders were not in an employment relationship
  • Termination: No ‘special circumstances exception’ when assessing resignation or dismissal
  • Tribunals: Tribunal’s failure to allege dishonesty amounted to a serious procedural irregularity

Worker Status: Supreme Court unanimously agrees that Deliveroo riders were not in an employment relationship

On 21 November 2023, the Supreme Court handed down its judgment in Independent Workers Union of Great Britain v Central Arbitration Committee [2023] UKSC 43. The issues at stake were, did the Central Arbitration Committee’s refusal to accept the Union’s application to be recognised by Deliveroo for collective bargaining interfere with the rights of Deliveroo riders to form and join a trade union under Article 11 of the European Convention on Human Rights? If so, was this interference justified? Should the courts below have construed section 296(1)(b) of the 1992 Act so as to give effect to Article 11?

This appeal concerns collective bargaining rights in respect of Deliveroo riders. The appellant, the Independent Workers Union of Great Britain (“the Union”) is an independent trade union whose members include Deliveroo riders. The second respondent, Roofoods Ltd (“Deliveroo”) operates the Deliveroo food and drinks delivery service.

On 28 November 2016, the Union submitted an application to the first respondent, the Central Arbitration Committee (“the CAC”), that the Union should be recognised by Deliveroo for collective bargaining in respect of a group of Deliveroo riders in the Camden zone. Applications are considered by the CAC in accordance with Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act 1992 (“the 1992 Act”). The CAC refused to accept the Union’s application on the basis that the riders were not “workers” within the meaning of the 1992 Act. This was because Deliveroo did not require them to provide delivery services personally, but permitted the use of substitutes, i.e. they did not provide “personal service”.

Both the High Court and the Court of Appeal dismissed the Union’s claim for judicial review of the CAC’s decision. The Union then appealed to the Supreme Court.

In a unanimous decision delivered by Lord Lloyd-Jones and Lady Rose in a joint judgment, the Supreme Court agreed with the previous decisions of the lower courts that the Deliveroo riders in question did not have an employment relationship with Deliveroo for the purposes of article 11 of the European Convention on Human Rights (ECHR) (i.e. the right to freedom of peaceful assembly and to freedom of association with others, including the right to form and to join trade unions), and therefore the provisions of that article did not apply to them.

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Termination: No ‘special circumstances exception’ when assessing resignation or dismissal

In Omar v Epping Forest District Citizens Advice [2023] EAT 132 the EAT had to consider the position of a claimant who had resigned ‘in the heat of the moment’ and then sought to retract the resignation. The claimant had contended that he should not be treated as having resigned as the situation fell within the so-called ‘special circumstances exception’ recognised in Sothern v Frank Charlesly [1981] IRLR 278. He argued that he had been unfairly and wrongfully dismissed. The employment tribunal disagreed and found that the claimant had resigned.

The EAT held, among other things, that the employment tribunal had erred in law by failing to make adequate findings of fact and failed to direct itself properly in accordance with the applicable legal principles set out in Sothern v Frank Charlesly. The EAT summarised the case law on the issue, including, among other things, that:

  • there is no such thing as the ‘special circumstances exception’; the same rules apply in all cases where notice of dismissal or resignation is given in the employment context;
  • words of dismissal or resignation, or words that potentially constitute words of dismissal or resignation, must be construed objectively in all the circumstances of the case in accordance with normal rules of contractual interpretation (i.e. the reasonably bystander test);
  • the subjective uncommunicated intention of the speaking party is not relevant, but the subjective understanding of the recipient is relevant but not determinative in assisting the tribunal form a judgment as to what the reasonable bystander would have thought.

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Tribunals: Tribunal’s failure to allege dishonesty amounted to a serious procedural irregularity

In Stuart Harris Associates Ltd v Gobudhun [2023] EAT 145 the EAT dismissed the respondent employer’s appeal against the decision of the employment tribunal that held that: first, the claimant employee had been constructively dismissed; and second, the respondent had been either dishonest or incompetent when they engaged in the expenses practice that had led to the claimant’s resignation.

The respondent contended that the employment tribunal had erred in law since: (i) it had prejudged the case; (ii) descended into the arena by conducting their own extensive research into the law and practice of filing tax returns; and (iii) determined that the respondent’s principal, had been either ‘dishonest’ or ‘incompetent’ when it had not been put to him in terms that his conduct was dishonest or incompetent.

The EAT held, among other things, that: (i) the failure to put to the respondent that he had acted dishonestly amounted to a serious procedural irregularity which meant that the finding of dishonesty had to be set aside; and (ii) there had been no prejudgment of the case and the employment tribunal’s conduct regarding the hearing had not been unfair.

Consequently, given that the employment tribunal’s conclusions as to unfair constructive dismissal could stand irrespective of the finding as to dishonesty, the decision overall remained and was not set aside.

Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

The information provided within this document is for general informational purposes only. While every effort has been made to ensure its accuracy, no responsibility can be accepted for inaccuracies. Readers are advised that laws and practices may change over time. This document is provided solely for informational purposes and does not constitute accounting, legal, or tax advice. Professional advice should be sought before making any decisions based on the contents of this document.