Uber drivers lead the way for revolution in the gig economy

In this blog Sally Cowen considers the implications of the recent Tribunal decision on the status of Uber drivers.

Uber drivers have been held by the Tribunal to be ‘workers’ under the definition in s.230(3)(b) of the Employment Rights Act 1996. Known as ‘limb (b) workers’ this entitles the drivers to a variety of rights in relation to their hours and pay. It also paves the way for others who work via apps, but whom are nominally regarded as self-employed, to test these waters.

A copy of the judgment is available here https://www.judiciary.gov.uk/wp-content/uploads/2016/10/aslam-and-farrar-v-uber-reasons-20161028.pdf

Uber have already indicated that they intend to appeal the decision of EJ Snelson and his colleagues in the case of Aslam & Farrar v Uber BV & others (case no 2202550/2015). It would not be surprising, given the number of people which this decision affects (approx. 40,000 in the UK), if the case ultimately went to the Supreme Court.

This decision will not only provide the drivers with their claims for holiday pay, national minimum wage and the right to rest breaks. By coming within the ‘extended definition’ in s.43K Employment Rights Act 1996, the drivers will also gain the protection of whistleblowing legislation.

Uber defended the claims of unfair dismissal, holiday pay, sick pay and whistleblowing on the basis that they are merely the providers and managers of an app, which is available to the self-employed drivers and that this is entirely distinct from the running of a taxi business.

The Tribunal were open as to the “ degree of scepticism” which they held over Uber’s position that they did not provide a taxi service and that they did not employ any drivers. They described the evidence of the Uber witness as “grimly loyal”, as they clearly did not like her unrelenting position on the “twisty ” wording of the contracts and the nature of the work undertaken by the company. Ultimately holding that “it is…unreal to deny that Uber is in business as a supplier of transportation services” and that “Uber runs a transportation business”.

The Tribunal found that the notion that Uber is a “mosaic of 30,000 small businesses linked by a common ‘platform’ is to our minds faintly ridiculous”.

The Tribunal has carefully set out the relevant views of the many precedent cases on this point, carefully noting that there can be no better guidance than the careful application of the law to the facts on each individual occasion.

As to the way in which these facts sit within s.230(3), the Tribunal is clear that there was personal work by the drivers under a contractual relationship. They found that the written contract bears no relation to reality, in a manner similar to the outcome of Autoclenz Ltd v Belcher.

The Tribunal also held that the driver is working at any point when he is within his appointed territory, has the app switched on and is ready and willing to accept trips and not merely when he accepts a trip. This may have implications for working time and pay issues.

With regard to the National Minimum Wage Regulations 2015, the Tribunal held that this was ‘unmeasured work’ and that any time spent travelling back to his territory after a trip had taken him away from that territory should also be treated as work. Once again this may have implications in other delivery and care sectors.

The judgment is of course fact sensitive and will no doubt be distinguished (or at least there will be a hearty attempt to do so) by other respondents as being particular to the taxi industry. But the question remains as to whether other services provided by way of apps (in a growing ‘gig economy’) will also be subject to this decision. It is reasonable to think that the cycle couriers and take away delivery drivers of the UK are celebrating tonight at what might also be a useful decision for them.

As to wider implications; that will remain to be seen. The essence of the judgment is that the whilst the Tribunal will look closely at the terms of the agreement, it is the practicality of the relationship which will dictate whether ‘worker’ status exists. That decision is not groundbreaking in legal terms.

It will of course take time for this case to wind its way through the EAT and possibly higher courts. In the meantime, every potential worker in this type of arrangement should be asking for their Tribunal claim to be stayed pending the outcome of these proceedings.

Cloisters specialises in employment law. If you or your clients need any assistance then please contact the clerks on 0207 827 4000.