The Supreme Court's ruling could have profound implications for other companies
The Supreme Court has dismissed Uber’s appeal against an employment tribunal ruling that its drivers must be classed as workers rather than self-employed contractors. The verdict has been a long time coming and means Uber drivers are entitled by law to a minimum wage and annual leave.
The case was first brought in 2016 by 35 Uber drivers. They argued that Uber exercised significant control over its drivers, including setting fares, imposing contract terms, monitoring trip acceptance rates, a punitive driver ratings system, as well as restricting communication between drivers and passengers.
The Supreme Court agreed. A key passage in today’s judgement, which was unanimously against Uber, said that Uber drivers were in:
Crucially, the judgement also found that working time is not limited to passenger time in a vehicle, but is accrued whenever an Uber driver is logged into the Uber app. This is significant because Uber’s existing transportation model relies on offloading the business risk of worker ‘downtime’ onto Uber drivers themselves. The ruling means the company will in future have to pay drivers a flat rate at or above the minimum wage, rather than the current piece rate.
I drove for Uber in 2017 while I was researching my book Hired. During the induction process at Uber’s offices in London, I was told that I could not “pick and choose” the jobs I accepted. Uber even laid down rules over what it was acceptable to talk about with passengers in the back of my cab. Politics, religion and sport were out of bounds. In other words, it felt like my passengers were Uber’s customers rather than my own.
Following today’s ruling, it is expected that thousands of Uber drivers will launch a mass action lawsuit against the company which could result in Uber having to pay out eye-watering sums of money in backdated claims for holiday pay and the minimum wage (worker status is a halfway house between self-employment and employee status, and does not entitle someone to sick pay or an unfair dismissal claim). The verdict could also have wide-ranging implications for other companies operating under the ‘gig’ economy model in which workers eschew certain rights for supposed flexibility and autonomy.
But the battle by Uber drivers to win recognition as workers may not be over just yet. Uber is still putting up resistance. Jamie Heywood, Uber’s regional manager for northern and eastern Europe, has emailed those working for the company to say that the ruling “does not apply to drivers who earn on the app today”.
However, as Lord Leggatt says in the judgement, the law will not “accord Uber power to determine for itself whether or not the legislation designed to protect workers will apply to its drivers”.
In other words, for all Uber’s reluctance to accept drivers as workers and not self-employed entrepreneurs, the company’s days operating in London under its current model are probably numbered.