Uber drivers are “workers” within the meaning of the Employment Rights Act 1996, an employment tribunal has held in a case with far-reaching implications for the “gig economy”.
In Aslam v Uber, Case 2202551/2015 at the London Central employment tribunal this week, Judge Snelson held the claimants were “workers” and therefore entitled to 5.6 weeks of paid annual leave, sick pay, a maximum 48-hour working week, the national minimum wage and the protection of whistleblowing legislation.
Judge Snelson described Uber as a “modern business phenomenon”, founded in the USA in 2009 and now operating worldwide with 30,000 drivers in London and 40,000 in the UK as a whole. Customers contact drivers through an app. Uber takes 25 per cent of the driver’s fare for standard journeys, including 25 per cent of £5 cancellation fares where a customer cancels a trip more than five minutes after it has been accepted.
The claimants sought compensation for failure to pay the minimum wage and failure to provide paid leave. Two claimants complained of detrimental treatment on “whistle-blowing” grounds.
Lee Rogers, employment associate at Weightmans, said the judgment was “not only likely to have serious ramifications for Uber, but for many organisations who operate in the so called ‘gig economy’.
“However, this is unlikely to be the end of the story—given what is at stake not just for Uber but for the industry as a whole, the decision is likely to be appealed. This decision will potentially open the floodgates for further claims, not just from Uber drivers but from thousands of others who work in the gig economy.
“It is crucial that businesses now watch this case closely over coming months, and in the meantime they should seek legal advice to ensure their contracts and policies around the engagement of staff are absolutely watertight, to avoid the risk of similar claims .”
Barrister Daniel Barnett, of Outer Temple Chambers, said: “Many Uber drivers complain they receive £300 after expenses for working 60 hour weeks.
“This is £5 per hour, far below the £7.20 per hour national living wage for the over 25s which they would be entitled to if they were 'workers'. Now they are entitled to at least £7.20 per hour after expenses. Uber's business model will need a major re-think."
As “workers” rather than “employees”, drivers would not be entitled to redundancy payments, unfair dismissal protection or other employee rights, Barnett said.
