Uber loses in the Supreme Court – their drivers are ‘workers’
24 February 2021
Two years after the Court of Appeal decision, the eagerly awaited judgment in the case of Uber v Aslam and others , has been handed down by the Supreme Court. This time the judges unanimously ruled that Uber drivers are workers and dismissed Uber’s appeal. We examine the reasoned decision of the Supreme Court.
Supreme Court decision
We have reported on the Uber case as it has progressed through the Employment Tribunal, Employment Appeal Tribunal and Court of Appeal. The main issues to be decided by the Supreme Court were:
- Whether the drivers were ‘workers’ providing personal services to Uber.
- If the drivers were ‘workers’, which periods counted as ‘working time’.
The Supreme Court found the Court of Appeal had been correct in finding that Uber drivers are ‘workers’, and that ‘working time’ was not limited to when passengers were in the vehicles. ‘Working time’ included time the drivers were logged into Uber’s app, located within the territory where they were licensed to operate, and were ready and willing to accept trips.
A relationship of ‘subordination and dependency’
The Supreme Court’s judgment described the relationship between Uber and the drivers as one of ‘subordination and dependency’.
Five aspects of the Employment Tribunal’s findings were highlighted as factors to support the conclusion that the drivers were workers.
- As rides were booked using Uber’s app, Uber set the fare rate and drivers could not charge more.
- Uber set the contract terms upon which drivers performed their services. The terms were not tailored to take account of driver preferences.
- Uber exercised the power of sanctions over drivers, through monitoring driver acceptance and cancellation of trip requests. Sanctions included penalties like temporarily cancelling driver access to the app, and suspending the ability to work/earn via Uber.
- By using a ratings system to monitor passenger feedback, Uber exercised ‘significant control’ over the way drivers delivered services. Warnings were given when ratings fell below average levels and inadequate improvement could result in contract termination.
- Uber took steps to prevent drivers from establishing a relationship with passengers capable of extending beyond one single ride booking.
Effect of the decision
It will be interesting to hear how Uber deals with further requests by its drivers to be recognised as ‘workers’, to benefit from paid holiday, rest breaks and the National Minimum Wage. Management at Uber have been quick to respond to the judgment, saying that the Court’s decision ‘focussed on a small number of drivers who used the Uber app in 2016’, and highlighted the ‘significant changes’ made to the business since then ‘to give more control to drivers over how they earn’ and by ‘providing new protections like free insurance in case of sickness or injury’.
With such a high-profile case reaching its conclusion, it is likely that many people within the gig economy will question whether their status is that of a ‘worker’, which will lead in many cases to an opening of discussions with employers/businesses about legal rights and compensation.
More organisations will begin to reflect upon their potential risk of liability of legal claims from ‘workers’, especially as many businesses have had a reduction in available work and cash reserves due to the pandemic. The Supreme Court’s decision may lead some to review the structure of their businesses and the type of workforce used. Others will consider their contracts and the way the business relationship with staff works, to aim to ensure that those they consider to be self-employed are treated in a way that is consistent with the new guidance. However, as we have seen following some other ‘worker’ case rulings, some businesses may change their practices very little or not at all and may wait to see whether potential ‘workers’ choose to present a legal challenge.
Meanwhile, as we have previously reported, the Government are expected to introduce a new Employment Bill this year, which is expected to include elements of the Good Work Plan. We will of course provide further updates on this once more information is available.
If you are an employer dealing with a gig economy or employment status problem, then we can help. Please call us on 01243 836840 for a no obligation chat, or email us at [email protected].