In a significant ruling, the Supreme Court of the United Kingdom (UK) has ruled that Uber drivers are ‘workers’, rejecting Uber London’s stance that the drivers are only independent contractors with Uber as their booking agent (Uber BV and others v. Aslam and others).
Since they are workers, the Court held that Uber drivers are eligible to receive the national minimum wage, paid annual leave and other workers’ rights in line with the laws of the UK.
A Bench comprising Lord Reed (President), Lord Hodge (Deputy President), Lady Arden, Lord Kitchin, Lord Sales, Lord Hamblen and Lord Leggatt pronounced the judgment earlier today, with Lord Legatt authoring the verdict.
“I think it clear that the employment tribunal was entitled to find that the claimant drivers were ‘workers’ who worked for Uber London under ‘worker’s contracts’ within the meaning of the statutory definition,” read the ruling.
The Court further stated that such drivers are working whenever they log into the Uber App, as opposed to Uber’s stance that they would only be considered working when they drive passengers to destinations.
“… the employment tribunal was, in my view, entitled to conclude that, by logging onto the Uber app in London, a claimant driver came within the definition of a ‘worker’ by entering into a contract with Uber London whereby he undertook to perform driving services for Uber London.”
The Supreme Court’s ruling hinged on the premise that the terms of the contract between Uber and its drivers need not convey the whole picture, and that the ground reality has to be examined to discern whether the drivers were workers entitled to UK’s statutory protections for such a class.
In assessing this reality, the following aspects highlighted by the Court of Appeal (which had earlier ruled that Uber drivers were workers and which ruling was challenged before Supreme Court by Uber) were taken note of by the Supreme Court:
- The remuneration paid to drivers for the work they do is fixed by Uber and the drivers have no say in it.
- The contractual terms on which drivers perform their services are dictated by Uber. Not only are drivers required to accept Uber’s standard form of written agreement, but the terms on which they transport passengers are also imposed by Uber and drivers have no say in them.
- Although drivers have the freedom to choose when and where (within the area covered by their Private Hire Vehicle licence) to work, once a driver has logged onto the Uber app, a driver’s choice about whether to accept requests for rides is constrained by Uber.
- Uber exercises a significant degree of control over the way in which drivers deliver their services. The fact that drivers provide their own car means that they have more control than most employees would over the physical equipment used to perform their work. Nevertheless, Uber vets the types of cars that may be used. Moreover, the technology which is integral to the service is wholly owned and controlled by Uber and is used as a means of exercising control over drivers.
- Uber restricts communication between passenger and driver to the minimum necessary to perform the particular trip and takes active steps to prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride.
The Supreme Court has rejected Uber’s stance that the question of whether the drivers are “workers” would have to be determined with the written agreement between Uber and the drivers as the starting point.
Inter alia, it was also noted that Uber London did not have a written agreement with the drivers. The only written agreements to which drivers were parties to were agreements with Uber BV, the Dutch parent company. In such a scenario, the conduct of the parties was key to determining whether the drivers were workers or independent contractors.
“…there appears to be no factual basis for Uber’s contention that Uber London acts as an agent for drivers when accepting private hire bookings,” the Court found.
Among other cases, substantial reliance was placed on the case of Autoclenz Ltd v. Belcher, wherein it was noted that the relative bargaining power of the parties must be taken into account to discern the nature of their relationship (even if there is a written contract, as was the case in Autoclenz).
The Supreme Court further noted that to accept Uber’s stance that the agreement between Uber and the drivers was the starting point for examining whether drivers were “workers” would run contrary to UK’s protective regime for workers.
“To do so would reinstate the mischief which the legislation was enacted to prevent. It is the very fact that an employer is often able to dictate such contract terms and that the individual performing the work has little or no ability to influence those terms that gives rise to the need for statutory protection in the first place. The efficacy of such protection would be seriously undermined if the putative employer could by the way in which the relationship is characterised in the written contract determine, even prima facie, whether the other party is to be classified as a worker. Laws such as the National Minimum Wage Act were manifestly enacted to protect those whom Parliament considers to need protection and not just those who are designated by their employer as qualifying for it,” reads the order.
The Court also noted that the UK laws bar would bar contracting out from the protective laws. In other words, those contractual terms which prevent workers from availing statutory protections would be void.