Hard2 marksMultiple Choice
Corporate and Business LawSection ASyllabus CEmployment Law

ACCA · Question 09 · Corporate and Business Law

UrbanDash operates a gig-economy food delivery platform. Riders provide their own bicycles, can choose when to log onto the app, and can send a substitute rider if they are unavailable. However, they must wear UrbanDash branded clothing. Applying the multiple (economic reality) test, what is the most likely employment status of the riders?

Answer options:

A.

Employees, because they are required to wear branded clothing, showing integration into the business.

B.

Employees, because UrbanDash controls the app through which they receive work.

C.

Independent contractors, primarily due to the lack of mutuality of obligation and the right of substitution.

D.

Workers, because they provide their own bicycles.

How to approach this question

Apply the criteria from Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance, focusing on personal service and mutuality of obligation.

Full Answer

C.Independent contractors, primarily due to the lack of mutuality of obligation and the right of substitution.✓ Correct
Under the multiple test (Ready Mixed Concrete), key factors for employment include personal service, control, and mutuality of obligation. The unfettered right to send a substitute is generally fatal to an employment relationship because it negates the requirement for personal service. Furthermore, choosing when to work negates mutuality of obligation. Therefore, they are independent contractors.

Common mistakes

Overweighting minor factors like uniforms while ignoring fundamental legal requirements like personal service.

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