Supreme Court decision: Uber drivers are not independent contractors

Uber drivers are not employees

The Supreme Court has today conclusively determined that Uber drivers are workers and not independent contractors engaged on a self-employed basis. This Judgment entitles the drivers to be paid minimum wage and holiday pay, as well as giving other statutory rights.

The Supreme Court’s decision means that all Uber drivers employed on similar terms to the drivers in this case are workers within the meaning of Section 230 of the Employment Rights Act 1996. The Supreme Court considered five issues of major importance:

  • The drivers had no say in the remuneration they are paid for their work, which is determined entirely under the contract drafted by Uber.
  • All contractual terms are dictated by Uber.
  • Uber exercised considerable control over the way the drivers delivered services such as control over the type of car used, directing them to the location of the passengers and preferred routes to the passenger’s destination. Uber also encouraged driver ratings on performance to determine whether a driver was permitted to continue to access the Uber App.
  • Once a driver is at work and logged into the Uber App, the driver’s ability to accept or refuse particular rides is constrained by Uber. Failure to attend sufficient number of rides resulted in Uber logging the driver off the App and preventing them to return for a period of time.
  • Uber restricted all communications between the driver and passenger through its App. Uber took proactive steps to prevent drivers from establishing any relationship with the passenger beyond the extent of that single trip.

There is no doubt this is a significant victory for the Uber drivers in the UK and has serious implications for all gig economy workers. Businesses operating this model need to review their terms and conditions in light of this Judgment to ensure their practices and contracts are legally compliant.

James Leo is a Partner in The Wilkes Partnership’s Employment Law team. If this decision raises any questions for you or your business, contact him on 0121 710 5970 or at [email protected].

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