Personal Service And The Right Of Substitution

• Published date: 10 January 2022
• Subject Matter: Employment and HR, Employment Litigation/ Tribunals, Employee Rights/ Labour Relations
• Law Firm: Trowers & Hamlins
• Author: Ms Emma Burrows and Nicola Ihnatowicz

The Employment Appeal Tribunal (EAT) has held in Stojsavljevic and another v DPD Group UK Ltd that individual owner driver franchisees (ODFs) who provided delivery services to DPD were neither employees nor workers.

The drivers entered into franchise agreements with DPD to operate parcel delivery services. DPD argued that they were independent contractors. The issue for determination was whether the ODFs had an unfettered right of substitution. Under the franchise agreement the ODF had to supply a driver (who could be the ODF himself or another person) to perform the services. A non-contractual operating manual stipulated that the ODF had to supply a copy of the driving licence of any proposed driver and complete an application form, in order for DPD to authorise that driver.

The EAT found that, although in practice the claimants had only used cover drivers who were also ODFs, or drivers or other ODFs, that did not detract from their broad contractual right to use any substitute of their choice at any time. There was no difference in DPD's approach to corporate and individual franchisees, with several of the ODFs being limited companies, operating multiple routes with multiple drivers.

It was implicit...