02 November, 2016
On Friday 28th October 2016, a London employment tribunal has made what some believe to be a "monumental victory" ruling in relation to Uber taxi drivers and their status as a "worker" under the Employment Rights Act 1996. This decision means that they will be entitled to certain employment rights, including; paid rest breaks, holiday pay and the national minimum wage.
The case was brought over one year ago by the GMB trade union, after claims were made against Uber for failing to meet its drivers' basic employment rights. Uber works with over 40,000 drivers in the UK and will now have to comply with funding various benefit costs. This may result in the company increasing the commission it receives as a percentage of each fare and both the drivers and consumers could lose out from this decision.
Uber perceives itself to be a technology firm and its drivers to be self-employed and able to decide when they do and do not work. However, it was ruled that "Uber runs a transportation business" and that "The drivers provide a skilled labour through which the organisation delivers its services and earns its profits".
The judges stated that "The notion that Uber in London is a mosaic of 30,000 small businesses linked by a common 'platform' is to our minds faintly ridiculous,". The San Francisco based company believe that its drivers are classed as self-employed contractors and not employees. The ride-hailing app have informed that they will continue to appeal this decision and we may see this go the whole way to the Supreme Court.
Jo Bertram, the UK manager of the company, stated that "Tens of thousands of people in London drive with Uber precisely because they want to be self-employed and their own boss". A driver has informed that he feels the vast majority of drivers will be very worried about whether Uber can now continue to run successfully and made it clear that he believes he works for himself and makes his own decisions. Another driver based in London stated that whilst the holiday pay and sick pay is perfect, he cannot work and maintain his car on wage.
This decision will directly affect those 19 drives who brought the claim, but importantly this decision is limited to Uber's specific and unique business model and is not binding on any other companies. However following this decision, we may see a rise in additional Uber drivers bring a claim and further other 'gig economy' companies facing claims regarding their contractors 'worker' status.
For advice or assistance in relation to this issue please contact a member of the Forbes Employment Team on 0800 689 0831. Alternatively send any question through to Forbes Solicitors via our online Contact Form.