Court rules that Uber drivers are not self-employed

On 19 February 2021, the long-awaited judgement in the case of Uber BV v Aslam was handed down by the Supreme Court.

It was unanimously ruled that Uber drivers are not self-employed, as Uber themselves argued, but are workers and are therefore entitled to basic rights such as the national minimum wage and holiday pay.

The following factors influenced the Supreme Court’s decision:

1. Uber sets the fares and the drivers are not permitted to set their own prices.
2. Uber sets out the terms and conditions for using its service and the drivers themselves have no say in this.
3. Drivers face penalties for cancelling rides or failing to accept them. If a driver cancels too many rides, they are logged out of the app for ten minutes, meaning they are unable to work during such time.
4. Uber exercises control over the way in which the driver provides their services. The Judgement referred to many examples as to how this control is exercised, one notable element being the rating system which the app has.
5. Uber restricts communications between driver and passenger and therefore prevents the establishing of any relationship beyond the individual ride.

In summary, the service performed by drivers is closely controlled and defined by Uber with Lord Leggatt stating that: the relationship between Uber and its drivers is one of “subordination and dependency,” and the lower courts were right to find that Uber drivers are indeed workers.

It was also an element of contention as to when the drivers were “working”, as Uber argued that this was only when passengers were being driven to their destinations. The Supreme Court upheld the earlier finding that drivers are deemed to be working as soon as they log into the app, in the area in which they are licenced to operate and poised to accept rides.

The ruling has implications for Uber’s business model and whilst it will not immediately affect other gig economy organisations, it is likely that there will be an increase in similar claims directed at other businesses as the judgement reinforces the importance of basic employment protections that workers are entitled to.

It will be interesting to see whether other members of the gig-economy will try and distinguish themselves from this decision, or whether they will preempt the movement and seek to properly acknowledge the workforce’s employment status. As this Judgement has proven, failure to do so is likely to have severe ramifications, financially and for the organisation’s reputation. 

If you are an employer and would like advice about your workforce’s employment status, contact our specialist BLHR and Employment team.