As expected, the Supreme Court has unanimously upheld the decisions of the Employment Tribunal, Employment Appeal Tribunal and Court of Appeal that the Uber drivers in this case were workers and not self-employed contractors.
The decision was based on five reasons:
- Uber had complete control over setting fares for each ride.
- The drivers had no say in the terms on which they contracted with Uber.
- The drivers’ ability to decline to accept fares was constrained. If they rejected more than a certain number of fares offered within a given time, they would be locked out of the app.
- Uber had significant control over where the drivers delivered the service, including by the driver rating system.
- Uber restricted communication between the driver and passenger to the minimum required to deliver the service.
The Supreme Court found that this showed that the drivers were in a subordinate and dependent position relative to Uber, which controlled the relationship, with the drivers having minimal opportunity to improve their position using entrepreneurial or commercial skill.
The decision is therefore definitive that these drivers were workers and that their working time included:
- Periods when they were driving passengers; and
- Periods when they were logged in to the app and ready and willing to accept fares.
The last point is crucial because the central criticism by the claimants of Uber’s model was that drivers were having to spend unpaid time available to work for Uber without pay.
The decision means that the drivers will be entitled to claim at least the applicable rate of national minimum/living wage for both the time they were driving passengers and the time they were waiting while logged in and ready to drive. They will also be entitled to holiday pay based on those hours and statutory sick pay. Today’s decision does not extend to full employee status, which would confer entitlement to redundancy payments or to claim unfair dismissal to those with 2 years’ continuous employment.
When these claims were lodged, there were 40,000 Uber drivers in the UK, about 30,000 of whom were in London. It is expected that today's judgment will lead to many claims in the gig economy. Many of these will already have been lodged with employment tribunal but put on hold pending the outcome of the Uber case.
However. since the original decision in this case in the Employment tribunal in 2016, many ride-sharing and delivery companies, including Hermes, have already changed their contracts so drivers receive more than the legal minimum pay while driving.
The changes Uber made to its contracts mean that:
- Drivers can be logged into the apps of rival ridesharing platforms at the same time; and
- Drivers are not locked out of the Uber app if they decline fares.
It would take a fresh legal challenge to see if this meant time spent logged in and ready to drive no longer counted as working time for minimum wage and holiday pay purposes.
For advice on employment status, working time and holiday pay, contact our specialist team.