The Court of Appeal has allowed an appeal by Karshan (Midlands) Limited, which trades as Domino’s Pizza, in a dispute over the status of its pizza delivery drivers in 2010 and 2011.
The appeal arose from a Case Stated by the Tax Appeals Commissioner concerning whether drivers worked under contracts of service, with PAYE and PRSI applying, or as self-employed independent contractors. The High Court had upheld the Commissioner’s determination that mutuality of obligation existed in the individual shift arrangements.
In a judgment delivered on 31 May 2022, Mr Justice Haughton agreed with Ms Justice Costello that the required mutuality was absent from the arrangements under which drivers undertook delivery shifts. The court therefore allowed the appeal and answered “No” to the first question in the Case Stated. It did not need to consider whether other indicators of an employment relationship were satisfied.
The Commissioner had found that drivers indicated when they were available and that a store manager then prepared rosters. She concluded that placing a driver on a roster created a contract carrying mutual obligations to perform work. The Court of Appeal held that this conclusion misapplied the written agreement and the reasoning in an English case concerning Weight Watchers leaders.
The agreement said Karshan did not guarantee any deliveries or promise to use a driver’s services. It also allowed drivers to choose when to make themselves available, work for other delivery operators and arrange a substitute if unavailable at short notice. Haughton J. considered that these terms did not oblige Karshan to provide work or a driver to attend a rostered shift. In his analysis, mutual obligations applied only while delivery work was actually being done, rather than throughout the periods covered by rosters.
The Commissioner had treated the agreement’s advance-notice provision and substitution clause as limiting a driver’s ability to cancel shifts. Haughton J. said the substitution clause gave drivers a right to arrange a substitute but did not require them to do so. He also distinguished the Weight Watchers case, where the relevant terms imposed work-related obligations on a leader who proposed not to take a meeting.
The Commissioner had also found differences between the written agreement and practice: company vehicles were not available to rent, some drivers did not submit the required weekly invoices, and some were asked to assemble boxes while waiting for a delivery. Haughton J. concluded that these differences did not affect the question of mutuality of obligation.
The judgment addresses that issue at the procedural stage of an appeal on a Case Stated. It does not determine the broader employment-status question by applying the other criteria, and Haughton J. noted that arguments about developments in UK law had not been pursued in the appeal.