Uber: The UK Supreme Court rules that drivers are “workers” and not independent contractors

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The court said on Friday that an employment court had rightly found Uber drivers to be employees, and the company’s appeal was dismissed. The decision was unanimous. Uber drivers are blue-collar workers, the court said, because the company sets fares and has significant control over drivers using the app.

While the practical effects of the ruling are not yet clear, the decision could change how Uber UBER does business in the UK. The company may be forced to grant additional benefits to drivers, including paid time off and a minimum wage. The next step is for an employment court to decide how dozens of claimants will be compensated.
The case may also set a precedent for other workers and businesses in the broader gig economy, which thrived during the pandemic as a result of a surge in demand for food supplies and other services.

The lawsuit against Uber was first filed in a UK labor court by Yaseen Aslam and James Farrar in 2016 when the two men were driving for Uber. Aslam used to work for another company, but said lucrative rewards and bonuses lured him to Uber.

But Aslam claimed that the benefits quickly dried up as more drivers joined the platform, resulting in fewer trips and lower fares. The pair of drivers prevailed in labor court and then in two subsequent company appeals.

“I am overjoyed and enormously relieved by this decision, which will bring relief to so many workers in the gig economy who are so desperately in need of it. During the six years of this process we have followed the government commission and then a review of the gig economy, yet nothing to help us, ‘Aslam said in a statement Friday.

The case is now going back to the labor court, which could order Uber to pay compensation to about 20 original claimants. Thousands of other drivers have taken legal action against Uber and the decision could soon be applied to them. Drivers who used the platform at the time of the lawsuit may also be eligible to file a claim for compensation.

A vital market

The decision is a significant defeat for Uber in the UK, where it has come under pressure from labor activists and transport regulators. Much of the action took place in London, one of the world’s most important cities for the American technology company.

Before the pandemic, Uber said 3.5 million Londoners used the app regularly and it claimed 45,000 drivers in the capital. But the company has repeatedly sparred with city regulators on safety issues.

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The UK court ruling comes just months after Californians voted to exempt Uber and other gig-economy companies from state laws requiring them to classify their drivers as employees rather than independent contractors.

If workers are classified, workers would be entitled to a minimum wage and benefits such as sick leave and unemployment insurance. Uber and other giants in the economy, such as DoorDash and Instacart, have spent more than $ 200 million to publicly advocate for the exemption.

Before the UK ruling, Uber said it was determined to do better for its drivers, regardless of the outcome.

“We believe that all independent workers earn a decent wage,” Uber CEO Dara Khosrowshahi wrote in a blog post.

“We call on policymakers, other platforms and civil society representatives to act quickly to build a framework for flexible earning opportunities, with industry standards that all platform companies must provide to independent workers,” he added.

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