The Recent Uber Ruling Made Simple

Recently, the Supreme Court gave a landmark judgment for the rights of private hire vehicle drivers who provide their services through the Uber app. There were two issues that the Supreme Court were faced with:

Were the drivers (the respondents) workers? And if are defined as workers, when are they working for Uber?

Were the drivers workers?:

The term worker is defined under section 230(3) of the 1996 Employment Rights Act. It refers to an individual who has entered into or works under a contract of employment (s230(3)(a)), or any other contract where they perform personally any work or services for another party to the contract, whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual (s230(3)(b)). This was an important point to rule on as if Uber drivers are classed as workers, it would mean they are entitled to important rights such as being paid the national minimum wage and receiving annual paid leave.

Following an employment tribunal, it can be seen in article 39 of the judgment that it was decided that while the drivers didn’t work under a contract of employment, they were workers who worked for Uber London under workers contracts as per the statutory definition. The case at hand concerned the requirement as part of the statutory definition of a worker that there was a contract whereby an individual undertakes to perform work or services for the other party. In response, Uber contended that the individuals weren’t working under contract with Uber London whereby they undertook to perform services for Uber London. Instead they were said to be performing services solely for and under contract made with passengers through the agency of Uber London (article 42).

The Supreme Court concluded that the Employment Tribunal was correct to say that the drivers were workers. There were various important points that made the court come to this judgment, but all concerned how the workers differed from other taxi drivers. For example, the remuneration paid to drivers for the work is fixed by Uber and the drivers have no say at all (article 94), while the contractual terms on which drivers perform their services are also dictated by Uber (article 95). Furthermore, once a driver has logged onto the Uber app, their choice on whether to accept requests for rides is constrained by Uber (article 96), but the driver’s rate of acceptance and cancellations is monitored by Uber. These led the Supreme Court to conclude that they could be defined as workers as the service is so closely controlled and defined by Uber. Lord Leggatt, who offered the majority opinion,  also added at paragraph 101, that the standardised service provided is so Uber gets the benefit of customer loyalty and goodwill rather than the individual driver.

If the drivers are defined as workers, how are their working hours defined?:

The second issue at hand is if they were found to be workers, what counts as their working hours? The employment tribunal argued that they were officially classed as working when a. they had the Uber app switched on, b. within the territory in which they were authorised to work and c. were able and willing to accept assignments (article 39). Uber contends this is not the case and that the drivers are only working during the periods when they were driving passengers to their destinations (article 123.) As an alternative point Uber also contended that the tribunal should have found they were working when they accepted a trip request.

The Supreme Court judgment stated that it was clear that the latest the driver was working was when he accepts a trip, and should it be cancelled this does not mean no obligation was ever undertaken. However, this raised further questions regarding the possibility of whether the contract could come into existence even earlier, such as when the driver logged into the app. Once again, the Supreme Court concluded against Uber, confirming that the tribunal was correct to say the drivers were working for Uber when the three conditions stated above were met, and that this was not limited to when they were driving passengers or had accepted a trip (article 137). 

What happens now?

It is clear this was a win for the drivers. Above all, the case demonstrates how the minimum wage is in place to protect vulnerable individuals, while there have been argumentsthat it is going to have important ramifications for other workers in the gig economy, opening the door for additional benefits to be introduced. There is also the question as to how Uber will respond to this judgment. Having to pay minimum wage to all workers is going to seriously impact their bottom line, leading to conflict opinions as to what the solution will be. I believe that the consequences of this will be profound however, due to the pressures this will have on Uber it is likely that they will try and find a way around this ruling.

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