Uber ordered to pay drivers minimum wage in landmark case

When is your “self employed contractor” actually a worker?  In the case of Aslam, Farrar and Others -V- Uber, an English Employment Tribunal has ruled that two drivers who provide services to Uber are ‘workers’ within the meaning of the Employment Rights Act 1996.

Uber is part of the “gig economy”, which is essentially a group of workers who work on demand and are usually engaged as self employed, and therefore not entitled to a range of rights which benefit employees and workers.  Uber engages drivers under a “Partner Agreement” which says that drivers are self employed and required to pay their own taxes. 

The Tribunal found in this case that the drivers were ‘workers’. This means that Uber drivers will be entitled to a limited number of employment rights (but not those that only ‘employees’ benefit from – the drivers did not claim that they were employees, rather that they were ‘workers’).  Amongst other rights, they will be entitled to:-

  • ·         5.6 weeks’ paid annual leave each year
  • ·         a maximum 48 hour average working week, and rest breaks
  • ·         the national minimum wage (and the national living wage)
  • ·         protection of the whistleblowing legislation

As they are not employees, they will not be entitled to:-

  • ·         the ability to claim unfair dismissal
  • ·         the right to a statutory redundancy payment

A “worker” is an individual who has entered into or works under —

(a)a contract of employment, or

(b)any other contract whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not that of a client or customer of any profession or business undertaking carried on by the individual.

In deciding that the drivers were “workers”, the Employment Tribunal based its assessment essentially on the control Uber required to have over drivers, including the following:

1.      Uber interviews and recruits drivers.

2.      Uber controls the key passenger information, including the trip destination, and excluded drivers from it.

3.      Uber required drivers to accept trips and not cancel trips, and enforced this requirement by logging off from the App drivers who did so.

4.      Uber dictates the route that must be followed by the driver.

5.      Uber fixes the fare and the driver cannot negotiate a higher sum.

6.      Uber imposes a number of conditions on drivers (including the standard of car they must use and quality standards).

7.      Uber puts drivers through a rating system which effectively amounts to a performance/disciplinary procedure.

8.      Uber dealt with customer refunds, sometimes without discussing the matter with the driver, when the driver’s income would be affected. 

9.      Uber handles customer complaints, including complaints about the driver.

 Uber last week said it would appeal against an employment tribunal ruling that its drivers should not be classed as self-employed and so should receive the minimum wage.

 Although this decision is fact-specific, and based on Uber’s business model, it increases the chance of other ‘gig economy’ companies facing claims that their ‘contractors’ have worker status. 

In addition, legislation may be introduced in the UK to deal with these situations.  The prime minister, Theresa May, last month commissioned a review of employment practices that is expected to make recommendations for reform.  On Monday, senior Conservative MP Ed Vaizey called for self-employed workers in the “gig economy” to be guaranteed the legal minimum wage.  Employment law is a devolved matter in Northern Ireland, so separate consultation would likely occur before any legislation was introduced here.  However the judgement in this case will influence our own Industrial Tribunals in similar cases. 


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>