In October 2016, the Employment Tribunal found that a group of 19 Uber drivers are workers, rejecting Uber’s description of them as self-employed.

This means that these 19 drivers are entitled to workers’ rights including the right to receive at least the National Minimum Wage and paid holiday. The reasoning in the judgment should also apply to all Uber drivers which means that thousands of drivers could now bring claims to assert these rights.

Since the judgment I have been repeatedly asked about the impact it will have on the ‘gig economy’.

To answer, we first need to know what is meant by ‘gig economy’, an increasingly pervasive expression which, I would argue, is both imprecise and unhelpful for workers’ rights.

I have seen various different definitions of the term but what they appear to have in common is a reference to new technology and a workforce that has a degree of flexibility in when they work, a flexibility that is partly enabled by technology.  Uber is the archetypal example, with Deliveroo also frequently cited.

The implication of the word ‘gig’ is that the work is casual and inessential; that workers can ‘rock up’ to ‘gig’ should they choose, but they don’t have to. This contrasts with ‘normal’ employment on which people rely to make ends meet.  With this framing, it becomes easier to argue that those who ‘gig’ don’t really need basic protections like holiday pay and a minimum wage.

Except that in substance what many workers are doing in the ‘gig economy’ is no different to what workers have always done: work for a company which provides a service to customers. Technology has advanced how companies communicate with their workforce and customers and how companies organise the delivery of their services, but often the fundamentals of the relationship between company and workforce are unchanged.

In the drivers’ claim against Uber, the Tribunal found that Uber is a transport company that provides a taxi service to the public and that the drivers work for Uber by making themselves available to drive Uber’s passengers. The Tribunal rejected Uber’s arguments that it is merely a technology platform that connects Uber drivers with customers and that the drivers contract directly with customers to provide the driving service.

Further, the law applies to companies in the ‘gig economy’ just as it does to any other company; there are no special exemptions for companies that use new technology.

To be entitled to workers’ rights, the Uber drivers had to show the following to meet the legal definition of ‘worker’:

• That they entered into a contract with Uber to work for Uber. In other words, that they agreed with Uber to carry out work in return for payment by Uber;

 

• That they had to carry out the work personally (i.e. that they could not freely use a substitute); and

 

• That Uber is not a customer or client of a business or profession carried on by each driver (in the same way that, for example, you or I might be the customer of a plumber’s business when the plumber comes round to fix a boiler).

Below is a summary of why the drivers succeeded in each of these categories using the above numbering:

• The Tribunal found that drivers have contracts to work for Uber and that Uber’s argument that drivers enter into a contract directly with customers was ‘pure fiction’. There were numerous reasons for this conclusion including the fact that Uber not the passenger is legally responsible for paying the drivers for their work; terms are agreed between Uber and the passenger before the driver meets the passenger; and Uber refuses under any circumstances to give a passenger’s contact details to the driver, who only ever knows the customer’s first name;

 

• Uber accepted that the drivers have to work personally and cannot use a substitute;

 

• The Tribunal found that it was ‘absurd’ to suggest that Uber was a customer or client of a business or profession carried on by the drivers, again for numerous reasons including the fact that Uber interviews drivers as part of a recruitment process; it has a performance management process for drivers related to the drivers’ ratings; Uber punishes drivers for refusing or cancelling too many trips; and Uber sets the fare the passengers pay and drivers cannot charge a higher sum.

While this judgment only directly affects Uber drivers, it shows that Tribunals will apply the law to companies in the ‘gig economy’ just as they would to any other company.

The judgment also clearly illustrates that Employment Tribunals will disregard a company’s classification of its staff as self-employed if in reality they are workers or employees, and this is true even if the company makes the worker sign up to a document stating that they are self-employed.

So if riders for Deliveroo, couriers for Hermes or any other worker in the gig economy or otherwise meet the above test for worker status, then they will be entitled to workers’ rights.

There appears to be an increasing number of companies that are misclassifying their staff as self-employed and denying them the basic rights and protections to which they are entitled. It also seems that a lot of those companies operate in the ‘gig economy’.

We hope and expect that the judgment against Uber will give those workers the courage to come forward and assert those rights, and that companies in the gig economy will be forced to comply with the law.

 

Annie Powell is a solicitor in the employment and discrimination team at Leigh Day, the firm which represented the 19 Uber drivers in their Employment Tribunal case