The Employment Tribunal has made an important decision which looks set to have far wider importance than the 40,000 Uber drivers it directly affects.

Background

As is well known, Uber works by providing customers with cab rides which are booked through its app. Uber charges 25% of the booking fee, with the rest going to the driver.

In terms of the terms and conditions the drivers work under, these state that the drivers are self-employed, running businesses in their own right. If this was the case, the contracts would mean that the drivers would not be ‘workers’ and therefore not entitled to the national minimum wage, paid annual leave, whistle blowing protection, hours of work protection etc., under the minimum wage and working time legislation.

This case was a test case brought on behalf of all Uber drivers to determine whether or not they were in fact workers, and if so, what their working time would be (whether this would be from the point at which they left home, or only whilst they are carrying passengers).

The Employment Tribunal made an exhaustive survey of all the various factors that might go one way or the other in indicating worker status, for instance, against worker status, that the Uber drivers provide their own vehicles and have to maintain them and fuel them themselves, and are free to do as many hours of work as they wish.

Factors in favour of worker status, on the other hand, was that they cannot provide any alternative drivers under their accounts, that they have some protection where fares are not paid, and their cars are soiled by passengers.

The Employment Tribunal was very clearly of the view that Uber drivers are workers. They said so in very strong terms, describing Uber’s general manager for the UK as being “grimly loyal” in her evidence.

In terms of hours of work, these will be limited essentially to those hours where the individual is on the app and is in area. Given that most drivers live in the areas they drive in, this will effectively mean that their hours of work begin when they leave home and end when they return home.

Implications

Although this decision will entitle Uber drivers to minimum wage, maximum working hours, holiday pay etc. it will not entitle them to bring claims such as unfair dismissal, where full blown employment status is necessary. Furthermore, it appears that the case is set for a further hearing in the Employment Appeal Tribunal and it is likely that it will go all the way to the Supreme Court.

In terms of its wider application, certainly this is another nail in the coffin for the “gig economy” and in line with cases such as Lock v. British Gas. However, the Employment Tribunal was keen to point out that if the method of working was different, it might have been possible for the drivers to be viewed as not workers. Care will therefore need to be taken as this case is fairly limited to its facts.

Still, any employer engaging its staff under flexible arrangements which may undermine their employment rights would be well advised to take stock at this point and review their systems and processes.