News Updates

Uber drivers are workers, not self-employed contractors

Monday 31st October 2016

A number of Uber drivers brought claims alleging that they are workers and therefore entitled to various employment rights.  Mr Aslam and Mr Farrar were selected as test cases for a preliminary hearing before the ET, which examined their employment status.

The ET has decided that the definition of worker under S.230(3)(b) of the ERA 1996 (and equivalent definitions in other relevant legislation) was met. As workers Mr Aslam and Mr Farrar are entitled to the national minimum wage, 5.6 weeks of paid annual leave, a maximum working week of 48 hours, together with rest breaks and the protection of whistleblowing legislation. They are not entitled to employee only rights, such as ordinary unfair dismissal protection or statutory redundancy pay.

Uber argued that it only provided a technology platform through which drivers can provide transport services to passengers on a self-employed basis, but that Uber itself was not a transport provider. The ET disagreed considering Uber’s key function to be transportation, noting that it operates through a company that is regulated as a private hire vehicle operator. The ET considered the case put forward by Uber did not reflect the practical reality, stating that “the notion that Uber in London is a mosaic of 30,000 small businesses linked by a common 'platform' is to our mind faintly ridiculous.”

Uber’s case was dependent on the assertion that the driver enters in to a contract with each passenger to provide a transportation service. However, the Uber app ensures that neither party knows the identity of the other, the route taken is set by Uber and the price is calculated by and paid to Uber. The ET held the driver/passenger contract to be “pure fiction”.

In the ET’s view any driver who (a) has the Uber app switched on; and (b) is within the territory in which he or she is authorised to work; and (c) is able and willing to accept assignments, is (for so long as those conditions are satisfied) working for Uber under a “worker” contract.

The ET emphasised the control Uber exercised over how the drivers operated:

  • Terms for passengers are contradictory, stating that Uber is the drivers’ agent but that it has “sole and absolute discretion” to accept or decline bookings;
  • Uber interviews and recruits drivers;
  • Uber controls key information such as the passenger’s identity and intended destination;
  • Drivers are required to accept and/or not to cancel trips and Uber enforces this requirement by logging off drivers in breach;
  • Uber sets the default route for each trip and the driver may face deductions if s/he departs from it;
  • Uber fixes the fare;
  • A rating system effectively amounts to a performance management/disciplinary procedure;
  • Uber determines issues about rebates, sometimes without involving the driver;
  • Uber accepts the risk of loss, for example in the case of fraud, which if the drivers were genuinely in business on their own account would fall on them;
  • Uber handles passenger complaints; and
  • Uber reserves the right to unilaterally amend drivers’ terms.

Uber has confirmed that it will be seeking leave to appeal the decision.

All information in this update is intended for general guidance only and is not intended to be comprehensive, or to provide legal advice.