The Supreme Court has recently handed down its judgement in an appeal bought by Uber, against a ruling recognising its drivers as workers, not independent contractors. It has upheld the original ruling, meaning Uber drivers should be viewed as employees, with all the associated rights that includes.
This is the latest – and final – ruling in a long running dispute and has profound implications for both Uber and the UK gig economy as a whole.
Uber had hoped to overturn the decisions of three lower courts, which all ruled in favour of the 35 Uber drivers involved in the case. They claim they are workers as Uber controls much of their work, allocating them customers and dictating prices, and as such should be entitled to the minimum wage as well as holiday and sick pay and rest breaks.
However, Uber had argued that it merely acts as an ‘agent’ between drivers and their passengers and that this means drivers are self-employed contractors.
Two Uber drivers brought the original case back in 2016, where the Employment Tribunal found in their favour. The Employment Appeal Tribunal in November 2017 and the Court of Appeal subsequently upheld that ruling in December 2018.
The case has been closely watched in the industry, as it has wide reaching ramifications for the ‘gig’ economy, which is estimated to employ nearly five million people in the UK.
In addition, there are currently approximately 1,000 similar claims concerning Uber, which have been put on hold that could now go forward.
Commenting on the ruling, Nick Hobden, head of employment at law firm Thomson Snell & Passmore says: “This decision should come as no surprise to those involved in running the gig economy, e.g. running private vehicle hire operations and who have quite comprehensive contractor agreements that prescribe the relationship between the contractor and the operator as an independent contractor.
“The Supreme Court has stuck to the basic principle that it is the statutory interpretation of what is a worker that is the supreme consideration. Not what the contract says. Even if the contract is clear about the nature of the relationship. The reality of how the agreement is performed must stand up to scrutiny, according to the legal interpretation of what a worker is: Someone who works under a contract and who undertakes to do or perform any work or services for another, where the latter is not a client or customer.
“Workers are never able to dictate their contract terms, rates of pay and communicate with end users. Operators restrict the workers freedom to choose when to work and dictate the way services are delivered. It is the operator’s way or the highway! When it is the operator’s way, then the Supreme Court says that they must discharge their statutory duties to pay the national or living wage rates (even when not driving but logged on to an app) and 5.6 weeks paid holiday each year under the working time regulations. Workers (as the vulnerable individuals in the relationship) must get the benefit of those protected benefits.”