Significant Employment Tribunal Ruling for Uber Taxi Drivers

The Employment Law team at Smith Partnership have been closely following an Employment Tribunal in London which has recently ruled on the employment rights of two taxi drivers engaged by the taxi mobile phone app, Uber. The ruling could have significant ramifications thousands of taxi drivers and self-employed people across the Midlands.

James Johnson, partner and Head of Employment Law at Smith Partnership spoke about the significance of the ruling: “Uber considered all its 40,000 plus drivers to be self-employed, therefore negating normal employee/worker rights, such as the right to National Minimum Wage, maximum working weeks, paid annual leave and other protections such as for whistleblowing.

“However, this assessment by Uber has been challenged by two drivers who have been successful in their claims through which they asserted that they were ‘workers’ and therefore were entitled to minimum employment rights.

“The basis for the challenge is that effectively the drivers are controlled by Uber who dictate every aspect of what they do. Control is the key to differentiating between a genuinely self-employed person and a worker/ employee.”

According to the Employment Tribunal decision, Uber drivers, are workers and are entitled to:

  • 5.6 weeks' paid annual leave each year
  • A maximum 48 hour average working week, and rest breaks
  • The national minimum wage (and the national living wage)
  • Protection under whistleblowing legislation - However, the Employment Tribunal did not go as far as to declare the drivers as employees, and as such they remain unable to claim: 
  • Unfair dismissal
  • Statutory redundancy payments
  • Implied terms of trust and confidence
  • The protection of TUPE, if Uber sold its business in the future

Whilst the notion of a “gig economy” is quite a recent one, the rapid growth of Uber shows the potential available for this type of business structure.

However, companies seeking to apply similar models must now be prepared to apply the minimum employee rights to those engaged, or otherwise run the risk of large scale claims.

The status of an individual engaged to carry out work for a company is a matter of great importance. Simply labelling the individual as “self-employed” is insufficient and companies must demonstrate that in practice.

If you require an assessment of your own employment status, or assistance in drafting appropriate terms of engagement, please contact James Johnson, Partner & Head of Employment on 01332 225271 or james.johnson@smithpartnership.co.uk