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What does the landmark Uber workers ruling mean for the gig economy?

What does the landmark Uber workers ruling mean for the gig economy?

Yesterday, the United Kingdom’s Supreme Court dismissed an appeal by ride-share app Uber to overturn a judgement that its drivers are ‘workers’. The decision means that the Court has enforced a precedent that those who drive for the app are workers and not just self-employed, as Uber had sought to classify them as. Upholding the previous High Court decision means that Uber drivers will have access to greater employment rights and setting a potentially significant precedent for the future of the gig economy.

The gig economy are workers who are not paid hourly or salaried rates but are paid for each ‘gig’ that they do. Uber drivers, Deliveroo riders and Fiverr providers are all considered to be gig economy workers, and the companies who they work with all have varying degrees of rights afforded to those individuals, depending on the status granted.

Many companies refused to consider those who provided services through their platforms to be workers, with Uber being locked in a 6-year legal battle against two drivers – James Farrer and Yaseen Aslam – about their status. It was the dismissal of Uber’s appeal that brought that battle to an end and finally declared Uber drivers as workers.

Under UK law, there is essentially three classes of workers: employees, who have full employment rights; workers, who are afforded some of these protections; and self-employed workers, who have few protections at all. Although the UK Courts have stopped short of naming drivers as full employees, the definition of workers expands drivers’ legal rights and ensures that they are entitled to at least the National Minimum Wage, statutory holiday pay and whistle-blower protection.

The decision will only apply directly to the 25 drivers who brought the claim against Uber, with them initially winning an employment tribunal in 2016, before the decision was appealed all the way to the UK’s highest court. However, it does set a significant precedent that gig economy platforms should regard those that use their applications as workers, affording them the same rights as workers in the traditional economy.

Currently, the ruling means that the drivers involved in the case, known as Uber v Aslam and others will be entitled to compensation, but does not immediately mean that all drivers will be classed as workers. However, it does allow further cases to be brought against Uber for failing to protect these rights and will likely result in the company shifting its policies to avoid more cases being brought.

This may also result in other gig companies changing their policies. The Supreme Court said that their decision to dismiss the appeal was based upon Uber setting fare prices; making drivers comply with a contract; imposing penalties if drivers decline too many trips; exercising control over the delivery of services due to the rating system; and restrict communication between drivers and riders. It was felt that these developed a relationship between Uber and the drivers that constitutes a worker and employer status.

Companies that exercise similar constraints on drivers may therefore face legal battles in the coming months and years or will seek to update the way they operate in order to comply with the new legal precedent. With the Trades Union Congress (TUC) estimating that 5 million were employed in the gig economy in 2019 alone, it is clear that this is a landmark judgement and a significant step forward for workers’ rights.

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