They Think It’s All Uber...It Is Now!
By Christian Ayerst · Feb 25, 2021
Or Is It?
It’s appropriate that in an age when VAR decisions are hot topics in football, the employment law equivalent has just been made by the highest court (Supreme Court) in the United Kingdom.
The judgment (available here): https://www.supremecourt.uk/cases/docs/uksc-2019-0029-judgment.pdf) is very digestible, informative and well-reasoned. In short:
The Uber drivers (who started work in 2016) are considered “workers” (and not self-employed). They are entitled (amongst other things) national minimum wage and paid annual leave.
The relevant factors the Supreme Court took into account were:
When a passenger books a ride, Uber sets the fare. The driver has no input into this - unlike a genuine self-employed worker (who is able to negotiate a price for his/her work).
Uber imposes contract terms upon drivers (at various points, including during a transaction and during an onboarding process). Drivers have no realistic opportunity to vary these - unlike a self-employed worker (who in practice is able to negotiate).
Once a driver logs-in, Uber monitors their usage and imposes penalties for non-performance (such as low ratings, failure to accept rides). A self-employed driver is less restrained (and typically on a project-by-project basis).
There is no real relationship between the driver and the passenger. Communications between the two are limited - and dedicated by Uber. This does not fit Uber’s argument that “we are a platform introducing the driver and the passenger - but the contractual relationship is between these two parties - and not us”.
Having decided the worker/self-employed question, the Supreme Court then decided that the “working time” a driver is engaged for is not just when they are driving - but the entire time they are logged-on to the Uber app.
One interesting observation by the Supreme Court was that the contracts and the paperwork relied upon by Uber (that they were a tech platform connecting drivers and passengers directly) did not reflect the situation on the ground. This should be a clear warning to any employer who thinks that signed terms and contracts are 100% evidence of a self-employed relationship. In fact - the law will unpick the reality of a relationship. A paper-trail is instructive - but not concrete proof of the relationship.
So this judgement is the final word in the Uber/worker debate. Or - like a contentious VAR decision - is this one which will be debated long after it has been decided?
Our view is that this is a very helpful decision. Both employers and employees must reflect on their positions now, especially the following points:
Do your work processes and contracts reflect the reality? The Supreme Court was very clear - paperwork and legal contracts are inferior to how the relationship genuinely operates. Do these reflect the reality of the work process?
What Do Your Employees Do? You are more likely to be employing a worker than a freelancer if control over the customer/business relationship rests with the employer, rather than the employee. If an employee has limited interaction with the customer (i.e. ability to generate repeat business, negotiate prices, set terms) then they are more likely to be a freelancer than not. Ask yourselves “what is the real level of interaction between the customer and the staff”?
Which Other Business Areas Might Be Affected By This? Uber’s position is that this judgment is limited to a small group of drivers (employed in 2016) and not courier services such as Uber Eats (https://www.uber.com/en-GB/blog/supreme-court-verdict).
We understand the logic for this - carrying passengers (where safety and personal service is a premium) is conceptually different to the transport of food. But there are similarities to the critical factors which indicate that workers are being employed (such as no negotiation of prices, limited customer contact, limited ability to secure independent work).
Ultimately the decision is good for everyone: it lays out clear inflection-points for whether you are in a worker or self-employed relationship.
However - the ramifications for companies traditionally relying upon self-employed workers to deliver their services could be significant. At gigl, we see clear ways to navigate a path through these - which benefit both employers and employees. Get in touch - we’re happy to talk.
And until then - long may the controversies of VAR and the worker/self-employed decisions keep us entertained and infuriated in equal proportions.