Where next for Uber? An update by Samuel Jones

On 19 February, the Supreme Court handed down its much anticipated judgment in Uber BV and others v Aslam and others [2021] UKSC 5.

It was held that the Employment Tribunal had been correct in finding that the Claimant Uber drivers had been “workers” for the purposes of the Employment Rights Act 1996, the National Minimum Wage Act 1998 and the Working Time Regulations 1998. The judgment has the potential to expose Uber to a number of claims from its current and former drivers for unpaid minimum wage and holiday pay. The status of “worker” also provides drivers with additional legal protections such as the right not to suffer a detriment, dismissal or redundancy for making a protected disclosure.

The claims have now been remitted back to the Employment Tribunal so that the claims can be assessed on their merits. Crucially, those subsequent judgments will consider how claims for unpaid minimum wage and holiday pay should be calculated.

In short, the Supreme Court held the following:

1. Uber was not an agent between the driver and the passenger. There was no written agreement which specified that Uber was an agent for this purpose and there was insufficient evidence to infer the same. Moreover, the applicable regulatory regime (which in this case was specific to London) almost certainly required Uber, as the “operator” who authorised bookings, to do so as a principal and not as an agent.

2. A tribunal should examine the reality of the relationship between the parties and is not therefore bound by the terms of the written agreement. Effectively, the usual rules of contract do not apply to employment contracts given the hierarchical relationship between the parties and the need to protect “workers” from abuse. The key test for establishing whether an individual is a worker or truly self-employed is the extent of control exercised by the employer.

3. The prohibition on contracting out of various protections has the effect that any provision in a contract which directly or indirectly prevents a “worker” or “employee” from bringing a claim is null and void.

4. Applying that analysis, the Employment Tribunal was entitled to conclude, on the evidence before it, that Uber drivers were “workers”, not self-employed subcontractors (as Uber had asserted).

5. The drivers are “workers” from when they turn on their mobile apps and are available for work in their specific area to when they switch off or disconnect from the app at the end of the day. The Supreme Court did not accept Uber’s contention that the drivers would only qualify as “workers” when there was a passenger in their vehicle.

Strictly speaking, the judgment only applies to the index claims. However, the guidance provided by the Supreme Court is likely to have far-reaching consequences not just for Uber and its drivers but for the gig economy and “workers” more generally. The judgment has now clarified and in some regards widened the Supreme Court’s earlier judgment in Autoclenz Ltd v Belcher [2011] UKSC 41.

So, what next for Uber?

Perhaps most obviously, it is going to face a significant number of claims in the employment tribunals and civil courts for non-payment of national minimum wage and for other entitlements such as holiday pay. Whether the Supreme Court’s judgment in Uber will apply to those claims remains to be seen as it is highly likely that the written agreements and working practices have changed since the first instance decision in that case.

It is also unclear how the employment tribunal and civil courts will approach the quantification of such claims and it is likely that significant litigation will now ensue on that point. Those representing claimants in the employment tribunal may also seek to challenge the legality of The Deduction from Wages (Limitation) Regulations 2014 which limits any claim for deduction from wages to two years from the date of presentation of the claim.

Watch this space.