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Seismic Shift in the 'Gig Economy' Landscape as UK Supreme Court rules on Status of Uber Drivers

The UK Supreme Court has handed down a landmark judgment in relation to the status of Uber drivers. The judgment has the potential to dramatically alter the manner in which the law has classified workers operating in the 'gig economy'.

The first two decades of the 21st century has seen a significant acceleration in the move away from traditional, stable and permanent employment towards the use of temporary, freelance or self-employed individuals. A Gallup poll in the US suggested that 36% of workers there were involved in the gig economy in 2018.

These people tend not to be classed as "employees" or "workers" for the purposes of employment legislation and have vastly diminished rights and legal security. That fact has become a matter of increasing concern to trade unions, government and the EU Commission. Attempts have been made to introduce legislation on the subject in Ireland, albeit without significant success to date.

car keys on dashboard

The UK Supreme Court has now been compelled to wade into the fray and has handed down judgment in the case of Uber BV v Aslam, [2021] UKSC 5.

The judgment notes that there were 30,000 Uber drivers in London at the time of the original employment tribunal hearing in the case in 2016. A number of those drivers claimed against Uber demanding rights under minimum wage legislation, working time regulations (in relation to holiday entitlements) and protection when engaging in whistleblowing. The relevant laws afforded these rights to "workers" or individuals employed under contracts of employment or equivalent contracts.

The question then arose as to whether or not the Uber drivers were "workers" employed under such contracts. Legal and HR professionals will be familiar with previous cases in which courts have decided on such questions by reference to the degree of control that the alleged "employer" had over the alleged "worker" or employee. That question of control arose yet again in the Uber case with the court stating as follows:

"In many cases it is not in dispute that the claimant is doing work or performing services personally for another person but there is an issue as to whether that person is to be classified as the claimant’s employer or as a client or customer of the claimant. The situation in the present case is different in that there are three parties involved: Uber, drivers and passengers. But the focus must still be on the nature of the relationship between drivers and Uber. The principal relevance of the involvement of third parties (i.e. passengers) is the need to consider the relative degree of control exercised by Uber and drivers respectively over the service provided to them. A particularly important consideration is who determines the price charged to the passenger. More generally, it is necessary to consider who is responsible for defining and delivering the service provided to passengers. A further and related factor is the extent to which the arrangements with passengers afford drivers the potential to market their own services and develop their own independent business.

In all these respects, the findings of the employment tribunal justified its conclusion that, although free to choose when and where they worked, at times when they are working drivers work for and under contracts with Uber (and, specifically, Uber London)."

On that basis, the Court went on to conclude that Uber drivers in London were "workers" employed by the company and were, for that reason, protected by employment legislation.

Commenting on the judgment, the General Secretary of the App Drivers & Couriers Union, James Farrar, said "this ruling will fundamentally re-order the gig economy and bring an end to rife exploitation of workers by means of algorithmic and contract trickery." One suspects, however, that the decision may simply be the latest twist in a legal debate regarding the classification of workers that has endured for the last 70 years or more and will continue for many more years to come.


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