This article previously appeared on the website of Stichting Vervoeradres (SVA) (link)

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On March 24, 2023, the Supreme Court ruled in the Deliveroo case. The Supreme Court ruled that delivery drivers working for Deliveroo can be qualified under labor law as employees and not self-employed. Although the Supreme Court's ruling relates to meal delivery workers, it is only a matter of time before other sectors will also start proceedings on the legal status of employees. A few hours after the publication of the ruling, FNV has already announced that they will investigate, whether the ruling has implications for sectors such as childcare, broadcasting, care and education.

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In this article, I take a closer look at the Deliveroo ruling and answer the question of whether the self-employed driver qualifies as an employee as a result of this ruling.

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Deliveroo case study

Deliveroo was active in the meal delivery market in the Netherlands from June 15, 2015 (now no longer). Through a digital platform, restaurants were linked to customers. Between 2015 and 2018, Deliveroo's meal delivery workers were employed under an employment contract. This changed in February 2018. Deliveroo decided not to renew the employment contracts with these delivery drivers and instead offered them an assignment contract. The assignment agreement stipulated that the delivery drivers had to register as self-employed with the Chamber of Commerce and have a VAT number. The delivery drivers who were initially employees thus became self-employed.

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In mid-2018, Deliveroo was sued by FNV. The union argued that the legal relationship between Deliveroo and the meal deliverers should be qualified as an employment contract within the meaning of Section 7:610 of the Dutch Civil Code. Both at first instance [1] and on appeal [2] it was ruled that Deliveroo's meal deliverymen were indeed working on the basis of an employment contract. Deliveroo appealed in cassation, but the Supreme Court also reached the same verdict [3].

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Qualifying employment contract

Assessing whether an employment contract exists requires a two-stage test [4]. The first stage is called the interpretation stage. This involves using the Haviltex standard [5] to determine what rights and obligations the parties mutually agreed upon.

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It is then necessary to assess whether the agreement between the parties meets the legal requirements of the employment contract. This is the second phase of the review, also known as the qualification phase.

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Pursuant to Section 7:610 of the Dutch Civil Code, a contract of employment exists if one party, the employee, undertakes to perform work in the service of the other party, the employer, for pay for a certain period of time. The main issue here is whether there is 'working in the service of'. This is also known as the "authority criterion.

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Views of the Supreme Court

In the Deliveroo judgment, the Supreme Court set out a large number of points of view that must be tested to determine whether there is an employment contract within the meaning of Section 7:610 of the Dutch Civil Code (qualification phase). These are as follows:

I) the nature and duration of the work;

II) the manner in which the work and working hours are determined;

III) the embedding of the work and the person performing the work in the organization and business operations of the person for whom the work is performed;

IV) the existence or absence of an obligation to perform the work personally;

V) the manner in which the contractual arrangement of the relationship of the parties was established;

VI) the manner in which remuneration is determined and paid;

VII) the amount of the rewards;

VIII) whether the person receiving the remuneration incurs a commercial risk in doing so;;

IX) whether the person performing the work behaves or can behave as an entrepreneur in the course of business;

X) the extent to which the contractual clause has significance for the party performing the work.

Whether an employment contract actually exists depends on all relevant facts and circumstances of the case considered together.

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Legislative proposals

Not only the Supreme Court is (has been) busy with the qualification question, the legislature is not sitting still either when it comes to employment contracts. At the end of December 2022, even before the Deliveroo ruling, the government announced that it will further clarify the authority criterion in the law. One of the proposals currently on the table is that under the authority criterion, not only the instruction power of the work provider to the self-employed person can be understood, but also whether the work is an essential part of the work provider's business operations. It will also clarify the question of whether an entrepreneur can actually be considered self-employed [6]. For this reason, the Supreme Court chose not to discuss these issues further in its ruling.

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Own rider

Because of the employment requirement, transportation companies are prohibited from using self-employed drivers. The only way self-employed drivers can be used in the transport sector is when there is a so-called "self-employed driver. The most recent Labor Market Report on Professional Goods Transport [7] shows that currently 10% of the number of drivers in the Netherlands are self-employed drivers. It is therefore possible that the Deliveroo ruling will also affect the position of the self-employed driver.

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A company may qualify as a self-employed driver if it carries out transport assignments for clients with its own truck (this can be via ownership, rental or lease), its own transport license and at its own expense and risk.

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I believe I can argue that the points of view from the Deliveroo judgment cannot be applied one-to-one to self-employed drivers in the transport sector. A number of indications and counter-indications for assuming a relationship of authority follow from the points of view.

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First, viewpoint III. This viewpoint deals with whether the worker's work is embedded in the organization. If this is the case, it can be assumed that a relationship of authority exists between the parties. There is embeddedness in the organization if the work of the self-employed worker corresponds to the work of salaried employees. In principle, according to the legislator, the position of driver within a transport company automatically indicates that the work is embedded in the organization [8]. This would therefore mean that a relationship of authority exists between a transport company and the self-employed driver because the same work is performed.

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I see this differently. A self-employed driver owns a transportation company and enters into a transportation agreement (and thus not an assignment agreement) with a principal. In performing the contract of carriage, by definition, instructions must be given. As long as a self-employed driver only receives instructions necessary to transport goods from point A to point B and is otherwise free in how he does so, this is an important difference between a self-employed driver and an employed driver. Only the self-employed driver is given the leeway to determine how he completes the work himself. In addition, a salaried driver has different kinds of obligations than a self-employed driver. For example, an employee must provide his employer with a timesheet (on paper or via the on-board computer) in order to get his wages paid. A self-employed driver does not have this obligation. This too is a contraindication for assuming a relationship of authority between the parties.

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Viewpoint IX also constitutes a counter-indication to the assumption of an employer-employee relationship between a transport company and self-employed driver. This viewpoint relates to the fact that being an entrepreneur automatically means that there can be no question of being an employee. The point here is that the self-employed driver actually presents himself to the outside world as an entrepreneur. For example, by making acquisitions, advertising for himself, using his own logo, performing (financial) administrative work and having a variety of clients. The fact that a self-employed driver also has his own vehicle also speaks for being an entrepreneur and thus the absence of a relationship of authority. It follows from various literature and the conclusion of Advocate General de Bock that if the worker is self-employed, there is no embedding of the work in the organization. The self-employed driver cannot then also have an employment contract [9].An explicit comment should be made here. In some transport markets, such as postal and parcel delivery, one can theoretically speak of entrepreneurship by having one's own bus and keeping financial records, but not always of being a self-employed driver. These drivers often drive for one and the same (sub)principal, at a "take it or leave it" rate and with a bus that, because of its payload, is not required to have a tachograph (and sometimes not even a transport license).

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The last viewpoint I want to discuss is the contract concluded between the parties (viewpoint X). Not only the conclusion of a contract of carriage but also the content, the manner of the conclusion of the contract and the performance thereof, are important in assessing whether an employee or self-employed person exists. In practice, a (verbal) contract of carriage is often concluded between the transport company and the self-employed driver. According to Section 8:20 of the Dutch Civil Code, the contract of carriage implies that one party (the self-employed driver), undertakes to the other party (the transport company) to transport goods.

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If there is a contract of carriage, this means that there is an obligation of result between the parties. This obligation of result follows from 8:21 BW. This article states that delivering the goods in the same condition as he received them is the result to which a carrier is bound. Under a result obligation, the carrier (self-employed driver) is free to decide how to transport the goods from point A to point B. The more concrete the result and duration of the assignment are described, the more plausible it is that the carrier works outside of authority [10].

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In addition, the principal in a contract of carriage also has a certain power of instruction. General instructions are necessary for carrying out transport orders and fulfilling the transport contract. After all, it must be clear to a self-employed driver to which customer, in what manner and at what time certain goods are to be delivered. The authority to instruct follows, inter alia, from Article 8:26 of the Civil Code, which stipulates that the sender is obliged to inform the carrier (self-employed driver) of all information relevant to the (handling of the) cargo. These instructions are not comparable to employee instructions in the employer/employee relationship as described earlier in this article. After all, an employer can instruct an employee not only about things like delivery time, location and cargo conditions, but also about the route to be followed, where and when to rest, which parking lots to park in, etc. A self-employed driver may, in principle, decide this for himself.

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The principal's authority to instruct also applies to self-employed drivers performing international transport. For example, it follows from Article 12(5) of the CMR Convention that a transport company can give instructions regarding the cargo.

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Conclusion

As I described above, not every viewpoint from the Deliveroo judgment applies to the self-employed driver. Furthermore, a number of viewpoints even constitute important contraindications for assuming a relationship of authority between a (transport) company and the self-employed driver.

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Despite the fact that the legislator states in its progress letter that being a driver automatically means that there is a relationship of authority between the parties (and thus an employment contract), I do not share this view in all cases. I think this is a lot more nuanced when it comes to self-employed drivers. In each situation, all relevant facts and circumstances must be considered. In addition, the articles in Book 8 of the Civil Code and the rules and customs that apply within the transport sector must also be taken into account.

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The Supreme Court leaves it to the legislature to provide further interpretation of the authority criterion. So now we have to wait for the legislator. For now, being a self-employed driver does not mean a priori that one can speak of an employment relationship.

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Footnotes

[1] Rechtbank Amsterdam 15 januari 2019, ECLI:NL:RBAMS:2019:198.

[2] Gerechtshof Amsterdam, 16 februari 2021, ECLI:NL:GHAMS:2021:392.

[3] Hoge Raad 24 maart 2023, ECLI:NL:HR:2023:443.

[4] Hoge Raad 6 november 2020, ECLI:NL:HR:2020:1746, r.o. 3.2.2 en 3.2.3.

[5] De Haviltex-maatstaf houdt in dat partijen bij de uitleg van een overeenkomst niet alleen kijken naar de letterlijke tekst van de overeenkomst, maar dat ook wordt gekeken naar de bedoeling van partijen en naar de vraag wat ze over en weer van elkaar mochten verwachten.

[6] Voortgangsbrief werken met en als zelfstandige(n), 16 december 2022.

[7] https://www.stl.nl/getmedia/37543b7f-d822-4339-a3e3-61bbab011b3c/STL-arbeidsmarktrapportage-2022-web.pdf, p. 17.

[8] Voortgangsbrief werken met en als zelfstandige(n), 16 december 2022, bijlage ‘beoordeling gezagsverhouding’, p. 2.

[9] Parket bij de Hoge Raad, 17 juni 2022, ECLI:NL:PHR:2022:578, r.o. 8.14 en G. Verburg, 'Overpeinzingen omtrent de vakbond als ondernemersorganisatie en de regulering van de positie van de zzp'er', ArA 2021/3, p. 64. In dezelfde zin: N. Gundt in haar noot in TRA 2020/84 bij HvJ EU 22 april 2020, C-692/19 (Yodel Delivery), par. 6. Zie ook N.M.Q. van der Neut in zijn noot bij de bestreden uitspraak in JAR 2021/62, waar hij op p. 580 uit de wetsgeschiedenis van de Wet op de Arbeidsovereenkomst afleidt: ‘zonder (vorm van) ondernemerschap moest de werkgever ‘gezag, leiding en toezicht’ houden tijdens de door de werknemer te verrichten werkzaamheden.’, en M. Jovovic & J.P.H. Zwemmer in hun noot in JAR 2019/23 bij de uitspraak in eerste aanleg, p. 251.

[10] Voortgangsbrief werken met en als zelfstandige(n), 16 december 2022, bijlage ‘beoordeling gezagsverhouding’, p. 1.

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