Uber has lost a final appeal in a protracted legal battle in the United Kingdom over whether its drivers are self-employed or legally-recognised workers eligible for benefits. The UK Supreme Court unanimously ruled February 19 that Uber drivers are indeed workers, confirming the view of three lower courts over the past five years.
The company had argued that its drivers are self-employed partners, not entitled to legal workers’ rights such as minimum wage, annual paid leave, and other protections. Drivers are “independent contractors” who do not work for Uber, but enter into a contract with passengers when the latter books a ride. Uber characterised the deduction of a commission on each ride as a service fee charged to the driver. It also emphasised that drivers are free to work when they want and as much or as little as they want. The court, however, shot this down, stating that any attempt by organisations to draft contracts intended to side step basic employment protections were unenforceable.
Further, the court laid down five key aspects that made Uber drivers “workers”:
- Uber sets the fare, drivers are not permitted to charge more than the fare Uber calculates
- Drivers have no say in the contract terms they enter into with Uber
- The driver’s choice of whether they can accept requests for riders is constrained by Uber. The company monitors the drivers’ rates of acceptance and cancellation of trip requests and imposing “what amounts to a penalty” in case of too many rejections or cancellations by automatically logging the driver off the app for ten minutes, thereby preventing the driver from working until allowed to log back on.
- Uber controls the way drivers deliver their services. Among the ways it does so is the ratings system, wherein Uber terminates its relationship with any driver who fails to maintain a minimum rating (following multiple warnings).
- Uber limits communications between the driver and passenger to the minimum necessary to perform a trip and takes active steps to “prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride”.
Further, the time spent by drivers working for Uber was not limited to periods of actually ferrying passengers, but included the entire period that the driver was logged onto the app and was accepting trips. The Supreme Court found Uber’s positioning of its services as similar to hotel aggregators and minicab drivers unsatisfactory. “The drivers were rightly found to be ‘workers’, the Court said.
Taking these factors together, the transportation service performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Drivers are in a position of subordination and dependency in relation to Uber such that they have little or no ability to improve their economic position through professional or entrepreneurial skill. In practice the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance. — The UK Supreme Court
What Uber said: Applies to few drivers, workers unequal to employees
In a blog post published soon after the verdict, Uber said the ruling only applies to a small group of drivers that originally went to the employment tribunal. The ruling will only apply to the those drivers; the verdict “does not focus” on other Uber drivers nor the people making deliveries for Uber Eats. “Worker is a UK specific legal classification and a worker is not an employee. Employee status was not claimed in the litigation and so this ruling does not find the claimants to be employees”, Uber said.
Many of the examples cited in the judgment no longer apply, the company claimed, since drivers now have more transparency; there are no longer any repercussions for rejecting multiple consecutive trips.