Outcome Could Have Big Impact On Gig Economy, Says Legal Expert

Uber has been granted the right to appeal against a landmark legal decision which ruled that its drivers qualify for basic employment rights.

The San Francisco-based company, which operates a smartphone app allowing passengers to hail licensed cars, will look to overturn last year’s ruling, which was seen as a major blow for UK companies in the so-called ‘gig economy’.

Last October a Tribunal ruled that Uber’s drivers should be classed as ‘workers’, entitled to rights such as sick pay and the minimum wage.

Uber argued that its drivers, who provide their own vehicles and set their working hours themselves, are ‘self-employed contractors’. The company says its app is merely a platform for linking drivers with passengers or customers.

Last year’s landmark ruling, sought by two Uber drivers, supported by the GMB Union, was significant for millions of workers in the gig economy. If Uber loses this appeal, due to be heard on 27 and 28 September 2017, they may be forced to make substantial pay outs to approximately 40,000 drivers in the UK and continue to bear the ongoing costs for holiday, sick and pension payments.

A spokesman for Uber said: “Almost all taxi and private hire drivers in the UK have been self-employed for decades and with Uber they have more control over what they do. Licensed drivers who use our app are totally free to choose if, when and where they drive with no shifts, minimum hours or uniforms.”

“The vast majority of drivers who use Uber tell us they want to remain their own boss as that’s the main reason why they signed up to us in the first place.”

Padma Tadi is an Associate Solicitor and employment expert at Irwin Mitchell. She said:

Expert Opinion

“Uber was always going to appeal, mainly because of the financial implications of having to pay historic and future national minimum wage, holiday pay and pension contributions for so many drivers. The initial decision was very fact-specific, and it will be very interesting to see if the Employment Appeal Tribunal agree whether the Uber app was simply a ‘platform’, as argued by Uber themselves, or whether the company has true direction, supervision and control over the drivers’ activities.

“Unlike the previous decision, the outcome of the Employment Appeal Tribunal will be binding, and will provide further authority on how courts will address ‘status’ challenges in the gig economy. As seen in this case, Tribunals will consider the nature of the relationship in practice rather than the contents of any signed or agreed contracts, which may portray the relationship in a different light to the situation in reality.”
Padma Tadi-Booth - Partner

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