Aslam, Farrar and Others v Uber
As previously mentioned in our article back in August – see here the latest news on this case is that the Employment Tribunal has now ruled that the 2 drivers who provide services to Uber are not self-employed and deserve certain worker rights – they are 'workers' within the meaning of the Employment Rights Act 1996.
Background
Uber operates a car hire platform that connects customers to drivers through a smartphone app. Customers can request a driver from any location in approximately 300 cities worldwide. Customers pay Uber and Uber pays a percentage to the driver.
On 20 July 2016, the GMB union, (a union which represents private hire drivers) brought two test cases to the Central London Employment Tribunal.
These cases were brought on behalf of two drivers, James Farrar and Yaseen Aslam. These drivers claim is that Uber drivers should be treated as “workers” and as such are entitled to certain employment law rights in the UK (bearing in mind we currently have employee, worker and self-employed status).
The drivers submitted that Uber must ensure that drivers are paid the national minimum wage. In addition, that they receive their statutory entitlement to annual leave and that they take rest breaks.
Uber
Uber argued that the drivers do not work for Uber but instead work for themselves as self-employed individuals.
The company further maintained that as a technology company and not a taxi company, its role is not to instruct drivers but to link supply with demand. It noted that Uber’s drivers can choose where and when they drive. Furthermore, its drivers are not exclusively required to work for Uber and may work with other private hire operators.
The Drivers
The drivers submitted that Uber exerts significant control over its drivers. In practice if a driver fails to pick up a certain number of customers a driver may be logged off the service for a period of time.
It was also noted that Uber controls the pay of its drivers and that it is able to impose disciplinary sanctions such as suspension on its drivers.
“Worker” status
Under UK employment law, all employees are considered to be workers but an employee has additional rights which do not apply to workers who are not employees. Hence in terms of protection and statutory rights, an employee trumps a worker but a worker trumps a self-employed person.
A worker is entitled to a number of protections similar to an employee including:
- national minimum wage
- statutory annual leave
- rest breaks
- protection against unlawful deductions from wages
- data protection rights
- protection against unlawful discrimination
- protection against whistleblowing.
However, the protections that employees have which a worker is not entitled to include:
- statutory minimum notice period if employment ends,
- protection from unfair dismissal
- the benefit of the implied term of trust and confidence
- protection of TUPE, if Uber sells its business
- statutory redundancy pay.
Comment:
Of course, it is virtually certain that this tribunal decision will be appealed up and up, potentially to the Supreme Court. So, although this decision is fact-specific, this case will have consequences for any business involved in linking customers to self-employed service providers based on Uber's business model - it increases the chance of other 'gig economy' companies e.g. Deliveroo, AirBnB and TaskRabbit facing claims that their 'contractors' have worker status.
Similar cases currently being brought against the courier firms CitySprint, eCourier and Excel as well as taxi firm Addison Lee and there will likely be more cases as the use of new technology and flexible workers become more commonplace in similar business models. So watch this space.
Faced with similar employment tribunal claims, these firms may either have to change their business models, or pass the increased costs onto customers. Hence the trend of firms taking on self-employed workers who engage with work through apps may have to change significantly in the future.
As far all businesses generally, good practice at a minimum suggests you should ensure that you are clear upon what basis you are using someone in their business and have appropriate contractual documentation or commercial agreements in place. If self-employed you should state that individuals are required to address their own tax affairs.
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