26th March 2021
26th March 2021
Uber uses a technology platform that puts customers, who are seeking taxi services (the passengers), in contact with drivers who own cars and are willing to offer taxi services for a fare. Everything is controlled through the app, from the cost of the fare to the route that is taken by the driver.
Uber drafted contracts between itself and the drivers stating that they were self-employed, i.e. they worked for themselves, rather than for Uber. In England we have three employment statuses:
As we work our way down the list, more and more employment rights fall away. So, employees have more employment rights than workers who have more than self-employed. The trade-off being that those who are self-employed are supposed to be more autonomous than employees, choose who they work for, set their own rates and workloads etc.
Mr Aslam and Mr Farrar, who were drivers for Uber, brought a claim to the Employment Tribunal (ET), challenging the classification as self-employed. Instead, they argued, that they should be considered as workers and entitled to the employment rights associated with that status. They were successful at ET in 2016, again at the Employment Appeal Tribunal in 2018 before succeeding at the Court of Appeal and then finally winning at Supreme Court.
Uber maintained that they were simply a technology provider and that the drivers were self-employed. It went so far as to say that the drivers were, instead, working for the passengers and that, in turn, the drivers provided services to Uber.
The Supreme Court unanimously disagreed with Uber’s case and handed down judgment on the 19 February 2021 that Uber’s drivers were workers and therefore entitled to the associated employment rights, for example national minimum wage, annual leave etc. Going even further, the Supreme Court determined that the drivers were ‘working’ from the time they log onto the app to the time they log off which will inevitably include time when the driver is waiting for a job to come through.
In coming to its decision, the Supreme Court focused on a number of findings made at ET:-
The message being conveyed from the tribunals and Supreme Court is that organisations cannot simply rely upon the terms of an agreement between the parties. Where the question of employment status is raised, the courts and tribunals will ‘step over’ the agreement and review the working relationship against the tests for employment status.
Employment status claims can be costly, time-consuming, stressful and have wide-reaching implications on your business model. Therefore, we advise that you do take stock of your current arrangements with those you engage with. If there are discrepancies between the agreed contractual employment status and working relationships, changes will need to be made. Whether that is to the contract or the day-to-day relationship, this should be determined by your organisation to best suit your needs.
A much more dangerous approach is to simply stick your head in the sand and hope that you will not get any such claims or, in Uber’s case, that you won’t get any more. Following the Supreme Court’s ruling, Uber published a statement asserting that the case only applied to a small group of drivers (25) and that it did not apply to any other drivers.
If you would like to discuss any employment issues, arising from this article, that may affect your organisation, please do not hesitate to speak to a member of the employment team on 01325 466 794 and ask for Anthony Willis or Alexander Millward. Alternatively email: AnthonyW@bhplaw.co.uk or AlexMillward@bhplaw.co.uk.