The Supreme Court has today handed down its decision in Uber BV and others v Aslam and others, upholding the Employment Tribunal decision that the drivers are ‘workers’ within the meaning of S.230(3)(b) of the Employment Rights Act 1996 (ERA 1996) and the equivalent definitions in the National Minimum Wage Act 1998 (NMWA 1998) and the Working Time Regulations 1998 (WTR 1998).
There are three levels of employment status in the UK: self-employed, worker and employee. Self-employed individuals are not entitled to the same employment protections as workers and employees, and so, for example, are not entitled to protection from unlawful deductions from wages, entitlement to receive the national minimum wage, and entitlement to paid annual leave. There have been a number of cases involving gig economy workers considering the employment status of these workers and, as a consequence what protections they will have.
A number of Uber drivers had brought claims before the employment tribunal claiming that they were in fact workers and were therefore entitled to additional employment rights. The employment tribunal held that the individuals were workers. Both the EAT and the Court of Appeal upheld the Employment Tribunal decision. Uber therefore appealed to the Supreme Court as the case had such wide ranging implications of the gig economy in general.
The Supreme Court unanimously rejected the appeal. The Court held that it is wrong, in principle, to treat the written agreement as a starting point in deciding whether an individual is a worker. The correct approach is to consider the purpose of the employment legislation. The employment legislation is intended to give protection to vulnerable individuals who have little or no say over their pay and working conditions because they are in a subordinate and dependent position in relation to a person or organisation who exercises control over their work subordinate position. The legislation also prevents employers from contracting out of these protections.
Applying the test for worker the Employment Tribunal were entitled to find that the drivers were workers. In particular the Supreme Court considered five aspects of findings by the employment tribunal which justified its conclusions:
- Where the ride is booked through the app it is Uber who sets the fare. As such, Uber dictates the level that the driver are paid for the work they do.
- Contract terms are imposed by Uber and the drivers have no say in the terms that are applied.
- Once logged on the drivers choice is constrained by Uber i.e. Uber monitors the number of trip requests that the driver cancels. Uber can take steps to penalise the driver if they refuse too many rides including automatically logging them off from the app.
- Uber exercises control over the way over the drivers provide their service. For example they apply a rating system and, if the driver fails to maintain a certain rating they can be removed from the app.
- The relationship between the driver and the client is very limited as the communications between the passenger and driver are kept to a minimum so that the driver is prevented from establishing any relationship beyond an individual ride.
Taking these factors together the method of transportation services is very tightly defined and controlled by Uber. The drivers are also in a position of subordination and dependency in relation to Uber such that have limited ability to improve their economic position through entrepreneurial skill. They are therefore entitled to the employment protection rights of workers.
The Supreme Court also considered the question of what amounts to working time. It held that time spent by the claimants working is not limited to periods when they are actually driving passengers. It includes the time when the driver is logged on to the app and are ready and willing to accept trips. However, this question should not be answered in the abstract. It had been argued that the driver could not be said to be working at the disposal of Uber if they could also be logged on at the same time to a competitor app. However, the Supreme Court held that at that time no evidence was adduced to show that the workers did log on to other apps.
This decision will have an impact on all areas of the gig economy. As the drivers are held to be workers then they will have rights to the national minimum wage and rights to receive paid annual leave