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Uber Appeal Decision

The Employment Appeal Tribunal has upheld the decision that Uber drivers are workers, not self-employed, and are therefore they are entitled to workers’ rights.

Background

There are three main types of employment status in the UK; employee, worker and self-employed contractor. Each has its own characteristics and associated levels of protection with employees gaining maximum protection and contractors the least. In this case, the Uber drivers argued that they are workers and Uber argued they are self-employed contractors.

Self-employed

Genuinely self-employed contractors will generally have a lot of flexibility over the way they work. Indicators of self-employment include; no obligation on the self-employed contractor to accept work, the individual being able to determine how the work is to be done, the ability to provide a substitute to carry out the work and having the freedom to decide their own hours and place of work.

Workers

A worker is an intermediary between employed and self-employed contractor. A worker is not afforded with full ‘employee’ rights but they are given significant rights and protections including the right to holiday and statutory sick pay and the National Minimum Wage. It can be difficult to determine whether a person is a worker as there may be elements of each of the three categories. Each case would depend on its own specific facts.

Uber case

The Uber drivers argue that they are workers because Uber has a significant degree of control over their work. For example, there are set routes, use of driver ratings, deductions from fares for bad reviews and penalties for not picking up customers. There is also a requirement to provide a minimum number of hours service and strict insurance requirements. Drivers are also unable to substitute another person to undertake a job and may suffer consequences for failing to maintain a minimum volume of work.

Decision

The Employment Tribunal agreed with the arguments of the drivers and found them to be ‘workers’.

Some of the reasons given by the Tribunal for its decision were that Uber subjected the drivers to interviews, Uber controlled the route and information that the drivers were given, it also set the fares and could reprimand the drivers if they diverted from a particular route. The Tribunal also found that drivers could be subjected to disciplinary-like sanctions if they fell below a certain rating. All of these factors supported the argument that the drivers were in fact workers (but not employees).

The Tribunal were critical of Uber’s argument they acted as an ‘introducer’ and that Uber was actually a network of businesses linked by a common technology platform. The reality was the drivers worked for, not with, Uber.

The Employment Appeal Tribunal has today upheld this decision. This means that the drivers will be entitled to a number of employment rights including:

  • The right to paid annual leave;
  • The right to be paid the National Minimum Wage/ National Living Wage; and
  • Protection under the Working Time Regulations i.e. a maximum 48-hour week and rest breaks.

Comment

This decision could have a significant impact on the way businesses operate throughout the UK given the increase in so-called “self-employed contractors”. In light of the EAT’s decision, businesses should review any arrangements they have with contractors and ensure that contractual documentation is up to date and accurately reflects the working relationship to minimise the risk of challenges. Watch this space for a further appeal from Uber!

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