Aslam and others v. Uber BV and others

Hot on the heels of the article in our last newsletter on Addison Lee and the "gig economy", on Friday 11 November 2017, the Employment Appeal Tribunal (EAT) confirmed an employment tribunal's decision that Uber drivers should be classified as "workers" and are not self-employed. This is now the most high-profile case on the employment status of the so-called "gig economy" workforce. The full judgment can be found here.

Most of our readers will be familiar with this case. Two Uber drivers brought a claim for unlawful deductions from wages and a failure to provide paid leave. The drivers successfully persuaded an Employment Tribunal that they were workers and should be protected under the Employment Rights Act 1996 (ERA). Uber argued that they were self-employed and were not entitled to these protections.

EAT Appeal

Unsurprisingly, given the potential costs to Uber which could be triggered by this decision, Uber appealed to the EAT. However, the EAT has upheld the Tribunal decision and found that the drivers are workers. This means they are entitled to the national minimum wage and paid annual leave. They can also raise claims for unlawful deduction of wages.

It is useful to look at the arguments Uber put forward, and which have been dismissed by the EAT. Uber argued that:

  • it does not provide taxi services itself but merely provides the technology platform facilitating those services;
  • there is a contract between driver and passenger for each journey with taxi services provided by the drivers;
  • the drivers are all self-employed; and
  • Uber London Limited holds the required private hire vehicle operator licence.

However, the EAT endorsed the original Tribunal decision that this arrangement bore the hallmarks indicative of worker status, namely:

  • potential Uber drivers are interviewed and successful candidates are given an induction;
  • if drivers commit serious misconduct, or their ratings fall, then the arrangement with the drivers can be terminated; and
  • although Uber drivers have the flexibility to decide when they can work, they are required to undertake to provide the work personally for Uber. This is one of the indicators of an employment relationship.

The Tribunal held that Uber drivers are never under any obligation to switch on the Uber application or even to accept a driving assignment when offered one. However, if the driver (i) has the application turned on, (ii) is within his authorised territory for work and (iii) is able and willing to accept assignments, then he is working for Uber under a worker contract and should be afforded worker rights and protections.

That said, it is not all doom and gloom for those looking for a flexible workforce. Both the Tribunal and the EAT made it clear that it is certainly not impossible for companies to enter into genuine relationships of self-employment. However, the important thing to remember is how the relationship operates in practice. If the legal definition of "worker" is met, then, irrespective of the label that the parties may apply to the relationship, and the imaginative explanations and wordings that companies such as Uber might use, the party providing the services is likely to benefit from worker rights.

The Uber case can be compared with the outcome in the Deliveroo case, the judgment of which was delivered on 14 November 2017. As many of our readers will be aware, like Uber, Deliveroo is app-based. In this case, it is a food delivery service that enables customers to order takeaway food from participating restaurants for delivery by Deliveroo's riders (usually by bicycle, scooter or motorcycle). In this case, the Independent Workers Union of Great Britain submitted an application to the Central Arbitration Committee (the CAC) for recognition for collective bargaining in respect of the Deliveroo riders in the Camden area. In contrast to the Uber case, the CAC found that the Deliveroo riders were not workers and so statutory recognition was not possible in relation to these self-employed individuals.

The CAC made a decision on the basis of section 296 of TULRCA, whereas in the Uber case, the definition of a "worker" is set out in section 230 of the Employment Rights Act. However, the CAC stated that Deliveroo riders would not qualify as workers under either statutory test. The interpretation of the Employment Rights Act is outside the jurisdiction of the CAC and so its comments in this regard would not be binding on an employment tribunal. They certainly do buck the trend reflected most recently in the Uber case and also those seen in cases involving, for example, CitySprint. However, the CAC in the Deliveroo case did seek to distinguish Deliveroo's model and relationship with its riders from that of the Uber drivers in that, in the Uber case, the issue of personal service was never in serious dispute. The Tribunal and the EAT gave short shrift to any such arguments in this regard. In the Deliveroo case, on the other hand, there was evidence that certain riders did take advantage of their right of substitution and sent another rider on a delivery in their place.

This provides, therefore, an illustration of the fact that genuine self-employment relationships are possible, but certainly need thought.