The Uber case was one of the first and arguably the most high-profile Gig Economy cases that contested whether the individual Uber driver was self-employed or a worker.
Originally, Uber had classed their drivers as self-employed (with their documentation articulating that the drivers were self-employed) and, as such, the company claimed it was merely an intermediary between their drivers’ businesses and the passenger.
The drivers have challenged their employment status through the tribunals and courts, contesting that they were workers and therefore entitled to certain employment rights associated with worker status. These include being paid the national minimum wage and being allowed to take annual leave.
Worker status primarily relies on the following:-
1) The Uber driver personally performing any work or services; and
2) Uber not being a client or customer of the individual Uber driver.
The Tribunals and Courts focused on the second of these two principles in great detail and considered whether each driver was in business on his own or whether the driver was actually working for Uber itself.
The Court of Appeal has now ruled that the drivers are workers. In a nutshell, the Court came to the following conclusions:-
• When considering working status, any written documentation (signed) that is intended to set out the working relationship will usually be taken into account. However, as this case identifies, this documentation will not be conclusive where there is a distinct difference in the bargaining position of the parties involved, and the terms put forward by the “stronger” party are standard terms put in place without negotiation. A “worldly-wise” approach is needed to understand the true position, which may be different from that as prescribed in any contract.
• There was a “high degree of fiction” in Uber’s written documents. Uber retained significant control over the individuals (speculatively, to satisfy its Private Hire Vehicle license in London). On acceptance of a job, the driver is obligated to take the passenger from a given location, and carry out the journey, and this was inconsistent with Uber being a client or customer of the driver.
• There is a contract between each driver and Uber, not between the passenger and the driver.
The Gig Economy cases continue to go one way in defining who is a worker and who is not an independent contractor. Modern methods of delivery of services through applications on modern technology personal devices, throw up problems for suppliers of these sorts of services, when trying to deliver these services through independent contractors, who are required to be available and deliver services to the suppliers without having any contractual relationship with the end users.
In other industries like construction, the distinction between independent sub-contractors and workers is often blurred. Care and legal advice needs to be taken when it comes to documenting the relationship between the contractor and sub-contractor and the documentation must be supported by the actuality.
If you have any questions concerning employment status within your business, or would like to formalise contractual arrangements with a written agreement, please contact one of our team
For the Court of Appeal’s full decision, please follow the link below.