The Supreme Court has upheld earlier courts’ rulings in a landmark decision that confirms Uber drivers are ‘workers’ and not self-employed subcontractors.
The Court unanimously upheld a 2016 Employment Tribunal decision that said drivers are in a “position of subordination and dependancy to Uber“.
While the decision relates to a limited number of drivers who used the platform in 2016, it is set to impact the UK’s wider gig economy and the employment status and entitlements of so-called ‘gig workers’.
Background to the case
Uber BV v Aslam and Others was first heard by the Employment Tribunal in 2016, when two Uber drivers brought a claim against the company for failure to pay them minimum wage and to provide paid leave.
Uber defended the claim on the basis that the claimants were self-employed and not ‘workers’, and as such were not entitled to the enhanced protections under employment law.
The tribunal found in favour of the claimants.
The decision was subsequently upheld by the Employment Appeals Tribunal, the Court of Appeal and finally the Supreme Court.
Legal basis to determine worker status
The Supreme Court judges stated their decision was based on five key points:
- The fare price is calculated by the Uber app. Drivers have no control or authoity to charge more. Therefore Uber dictates how much the driver is paid.
- Uber’s contracts and terms of service are imposed on the drivers with no scope for negotiation or variation.
- Drivers’ choice of jobs are monitored by the app and ultimately constrained by Uber since penalties are imposed if too many jobs are declined.
- Uber exerts “significant control” in how the drivers provide their service, eg the passenger ratings system determines if the driver can continue to work for Uber.
- Direct interaction between drivers and passengers is purposefully restricted by Uber so as to prevent relationships beyond the individual ride.
In effect, when determining employment status, parties should look beyond the employment documentation to consider the reality of the working relationship and whether a “position of subordination and dependancy” applies.
On this analysis, the Supreme Court found against Uber and held that the claimant drivers were ‘workers’ from the moment they switched on their Uber app and were available for work, to the time when they switched their apps off.
Impact of the decision on Uber
As a result of the decision, the 25 claimant drivers have been deemed entitled to claim minimum wage for their entire working day while logged onto the app, and not just while they were engaged carrying passengers.
The employment tribunal is yet to determine how much compensation the drivers will be awarded. They are expected to be entitled to claim for up to two years’ backpay or £25,000, whichever is the larger, at the employment tribunal, and up to six years’ backpay in the county court.
They can also claim 5.6 weeks’ paid annual leave each year.
Importantly, the decision does not automatically afford worker status to all Uber drivers, but is expected to precipitate new claims on similar grounds.
In light of the decision, Uber must now consider its drivers as workers while switched onto the app, affording them entitlements such as national minimum wage, statutory minimum holiday pay and rest breaks, as well as maternity and paternity pay and statutory sick pay in some cases, and protections in areas such as discrimination and whistleblowing.
Impact of the decision on the gig economy
Although the Supreme Court decision only directly applies to the drivers who claimed against Uber in 2016, it sets a precedent for how the millions of gig economy workers are treated and protected in the UK.
Although the judgment does not automatically mean that everyone in the gig economy can be classed as a ‘worker’, it paves the way for similar legal challenges, and provides a precedent that is likely to affect other gig economy employers such as Addison Lee or Deliveroo who employ individuals on a job-by-job basis.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services - a Marketing Agency for the Professional Services Sector.
