On the 19 February 2021, the Supreme Court handed down its decision in the long-awaited case of Aslam v Uber, which has set the approach for employment tribunals in the determination of ‘worker’ status. The Supreme Court has reached broadly the same conclusion as earlier courts that Uber drivers are workers and not independent self-employed drivers.
This ruling means that some Uber drivers are entitled to claim minimum wage including backpay. Additionally, these drivers are entitled to be paid for their entire working day and not just when they have a passenger in their vehicle. Uber drivers may claim up to 2 years’ backpay through the employment tribunal or up to 6 years’ backpay through the county court.
Uber drivers can also claim 5.6 weeks paid annual leave each year and will have access to other rights including whistleblowing and the right to union representation. This judgment does not however, afford ‘workers’ the rights reserved for ‘employees’, such as the right to a redundancy payment or to claim unfair dismissal.
The judgment confirmed the established principle that when an employment tribunal is deciding the employment status of an individual, the tribunal should examine the reality of the relationship between the parties, and not be bound by what the documentation states. Also, it confirmed in the circumstances of this case that Uber drivers are ‘workers’ from the moment they switch on their apps and are available for work in their area, up until the time when they switch their apps off at the end of the day. It can be seen that this will have a significant impact on the minimum wage and working time calculations for example.
Uber had argued that the courts had previously been mistaken in law by disregarding the characterisation of the relationship in the written contract between Uber and the drivers, and between the Uber company and the passengers. It was highlighted that written agreements entered into had stated that the role of Uber is to provide technology services and act as a payment collection agent for the driver. The agreement further stated that the role of Uber (London) was to act as booking agent for the drivers.
In dismissing the appeal, the Supreme Court unanimously held that the way in which a relationship is characterised in a written agreement is not the appropriate starting point in applying the statutory definition of a “worker” and should never be treated as conclusive, even if the facts of the case are consistent with more than one possible legal classification. The court observed that the working of employment protection legislation would be seriously undermined if potential employers were given the power to determine for themselves whether legislation designed to protect workers should apply to those who provide services for them.
The court noted that the vulnerabilities of workers which create the need for statutory protection are subordination to and dependant on another person and the degree of control exercised by that person. Although Uber drivers could decide when and where they worked, the tribunal had been entitled to find that during the periods when they were performing driving services, the drivers were working for and under contracts with Uber.
The facts demonstrated that the transportation service provided by drivers and offered to passengers through the Uber app was very tightly defined and controlled by Uber and that the drivers had little or no ability to improve their individual economic position through professional or entrepreneurial skill.
The case had been closely watched because of its ramifications for the ‘gig economy’, in which companies like Uber rely on a labour force of independent contractors to provide car rides, deliver food and even clean homes.
Overall, this landmark case means that Uber drivers are entitled to receive the national minimum wage, paid holidays and union representation.
A Supreme Court judgment on an issue as widespread as worker/business relations is almost inevitably going to have significant implications beyond the specific parties to the appeal. The Business Secretary announced that a post-Brexit review of workers’ rights had been cancelled although there are no plans to reduce workers’ rights. We are likely to see how this ruling will be interpreted over the next coming months.
Should you wish to discuss this article or the potential employment status of your workforce then please do not hesitate to contact Sarah Collier, Partner & Head of Employment Law.