NL: Supreme Court: Deliveroo deliverers not self-employed but employees. What circumstances are relevant for the assessment of the employment relationship?

 

According to Statistics Netherlands (CBS), 2022.1 million self-employed people were active in the Netherlands in the third quarter of 2, with the largest growth in the care and welfare professions, followed by the technical, commercial and ICT professions. In a labour market in which so many (and increasingly) self-employed people are active, clarity about the correct qualification of the employment relationship is more than welcome.

Major differences between freelancers and employees

The importance of the qualification of the working relationship is great. At the individual level, there are large differences, both tax and civil, between the contract of the assignment and the employment contract (for example, the sick employee is entitled to wages from the employer for 104 weeks, while the sick self-employed person bears this income risk himself). The correct qualification is also relevant at the collective level (in sectors where employers are obliged to take out pension insurance for employees, pension insurers collect contributions from employers, but not clients).

Deliveroo judgment 24 March 2023

That is why, at least by employment law specialists, the "Deliveroo" judgment of the Supreme Court was eagerly awaited. Would the Supreme Court give a clear answer to the question to be answered in practice when a worker with whom an assignment agreement has been concluded is really a self-employed person and when in fact there is an employee with an employment contract?

On March 24, 2023, the time had come. On that date, the Supreme Court ruled on the question of whether the meal deliverers of the digital delivery platform Deliveroo (now no longer active in the Netherlands) were working on the basis of an employment contract.

Conclusion: meal deliverers are employees

In the judgment, the Supreme Court concludes that the agreements with the meal deliverers, who were self-employed on the basis of an assignment agreement, were employment contracts. With this, the Supreme Court agrees with the judgment of the Amsterdam Court of Appeal from 2021.

Explanation: which circumstances are relevant?

Whether a contract is to be regarded as an employment contract depends on all the circumstances of the case in relation to each other. A relevant condition for the existence of an employment contract is that there is a relationship of authority between the parties. The existence of an employment contract requires that the worker works "in the service of" the employer.

When assessing the existence of an employment contract (or not), the following circumstances may – among other things – be important:

• the nature and duration of the work;
• the way in which the work and working hours are determined;
• the embedding of the work and the person performing the work in the organisation and business operations of the person for whom the work is carried out;
• the existence or non-existence of the obligation to carry out the work itself;
• the way in which the contract between the parties was concluded;
• the manner in which the remuneration is determined and the manner in which it is paid;
• the amount of the rewards;
• whether the person performing the work is at commercial risk; and
• whether the person performing the work behaves as an entrepreneur in economic traffic.

 

Party intentions play no role

It is also important that it is not important for the qualification whether the parties intended to make the agreement fall under the legal regulation of the employment contract. This follows from an earlier judgment of the Supreme Court in 2020 ("X v Municipality of Amsterdam") and has been repeated in the Deliveroo judgment.

Deliveroo cassation complaints rejected

The Supreme Court therefore agrees with the court. In particular, the Supreme Court considers the fact that the delivery drivers had the freedom to register for work if they wanted to and to refuse assignments. According to Deliveroo, this freedom, and the freedom of delivery drivers to be replaced, is incompatible with an employment contract. The Supreme Court disagrees: according to the Supreme Court, the freedoms mentioned here do not exclude the existence of an employment contract.

No further legal development by the Supreme Court

The Deliveroo judgment is useful for answering qualification questions in practice. On the basis of the circumstances listed in the judgment, an assessment can be made on a case-by-case basis of the likelihood that a court will consider an employment relationship to be an employment contract.

Unfortunately, the Supreme Court did not provide any further explanation. Because the qualification of the employment relationship (more specifically of the authority criterion "in the service of") has the attention of the legislator (Minister Van Gennip sent the Progress Letter working with and as a self-employed person(s) to the House of Representatives on 16 December 2022), the Supreme Court considered in the Deliveroo judgment what this further interpretation does not currently see as a reason for legal development. We are therefore waiting for further steps to be taken by the minister towards more clarity.

 

For further information, please contact:

Frouke Vlaskamp, Partner

Milestone Advocaten, Utrecht

vlaskamp@milestoneadvocaten.com

t: +31 30 744 0477

 

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