The Gig Economy – What Does It Mean For Workers?

In a highly publicised judgement, an Employment Tribunal was recently asked to decide whether a group of “Uber drivers” were “workers” of Uber, or self-employed individuals. Essentially, the question for the tribunal was, do Uber drivers provide their services to Uber personally or are they independent businesses which are promoted by Uber?

Background

Uber is a “transportation network” which began life as a black car service in the US. It uses technology - a phone app - to match taxi drivers with people looking for taxi services.

It is Uber’s position that it does not engage the drivers direct, it simply promotes and facilitates their business by putting them in contact with passengers. The drivers are free to work whenever they want and can simply switch off the app whenever they no longer want to provide their services.

What did the Tribunal Decide?

In a very detailed judgement, the Tribunal carefully considered each of Uber’s arguments, in particular its contention that:-

a)    Uber is effectively an app connecting drivers with customers and not a transport service;
b)    it has no direct contract with either the drivers or the customers. It merely facilitates the transaction; and
c)    it promotes the drivers’ businesses and works for them

In spite of the wording of Uber’s contracts, (which the Tribunal observed were very carefully drafted), the Tribunal concluded that Uber is effectively a transport service and that the drivers were “workers”.

What does this mean for the workers/Uber?

As workers, the drivers are entitled to:-
•    5.6 weeks’ paid annual leave per annum
•    A maximum of 48 hour working week on average
•    Rest breaks
•    Protection under the whistle blowing legislation
•    The national minimum wage

This will obviously have financial implications for both parties which means Uber may choose to appeal.

Does this case have any wider significance?

Uber is not the only company in the news for this reason. Deliveroo, whose workers recently staged a cycle protest in London, has been ordered by the Government to pay its workers the national minimum wage unless they are found to be genuinely self-employed by either a Court or HMRC.

Technology is clearly having a profound impact on the way businesses can offer their services to the public and the way they engage individuals to carry out their work. The Tribunal’s judgement sends a clear message that flexibility cannot be achieved at the expense of workers’ rights. The Tribunal did, however, observe that an alternative business model may lead to a different conclusion. Watch this space!

If you have any questions please contact Debbie Sadler at d.sadler@hewetts.co.uk or on 0118 955 9607.

Published on 06/12/2016