Uber loses gig workers rights challenge in a supreme court ruling in the UK.
From the country’s top court, the ride-hailing firm’s drivers should be classified as workers rather than independent contractors.
The decision could mean that thousands of Uber drivers are entitled to minimum wage and holiday pay.
The ruling is likely to hit Uber facing a hefty compensation bill, and have wider consequences for the gig economy.
However, Uber insists that its drivers are self-employed, a classification which grants them minimal protections. It doesn’t want them to be treated as workers as this would affect its business model and thereby resulting in higher costs for the firm.
In the United States, California voters supported the passing of a measure called Proposition 22 that will see freelance workers continue to be classified as independent contractors in November, overturning a landmark labour law passed in 2019.
The case, which dates back to UKs employment tribunal ruling in 2016, has major ramifications for Uber’s business model in the UK and beyond, as similar challenges are ongoing in European courts. Uber appealed against the employment tribunal decision but the Employment Appeal Tribunal upheld the ruling later in November 2017. Another appeal by Uber to the High Court, which upheld the ruling again in December 2018.
The ruling on Friday was Uber’s last appeal, as the Supreme Court is Britain’s highest court, and it has the final say on legal matters.
The court in its judgment considered several element like:
- Uber set the contract terms and drivers had no say in them
- Uber set the fare which meant that they dictated how much drivers could earn
- Request for rides is constrained by Uber who can penalise drivers if they reject too many rides
- Uber monitors a driver’s service through the star rating and has the capacity to terminate the relationship if after repeated warnings this does not improve
The courts ruling can be accessed here.
European Union lawmakers are also looking at conditions for gig workers, so policymakers were already facing pressure to clarify the law around gig work today’s ruling only increases that.