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UPDATE ON THE DIRECTION OF TRAVEL FOLLOWING THE UBER APPEAL

UPDATE ON THE DIRECTION OF TRAVEL FOLLOWING THE UBER APPEAL

Martin Stephen

Published by
Martin Stephen

13th November 2017

The Employment Appeal Tribunal (EAT), has now issued its decision in the Uber case where unsurprisingly it has upheld the Tribunal’s decision of December 2016 that when drivers have the Uber app switched on, they are “workers” and not, as Uber claims, “self-employed”.

This means that Uber drivers will not only be entitled to receive the National Minimum Wage but will also be entitled to rights deriving from the Working Time Regulations 1998 including 5.6 weeks' paid annual leave and rest breaks.

Uber relied upon the absence of a contract between it and the drivers.  Instead it attempted to rely upon written agreements between it and the drivers, which Uber insisted were inconsistent with the existence of any worker relationship. Uber maintained that the agreements made clear, the drivers provided transportation services to riders and that Uber provided its services to the drivers as their agent.  In rejecting that argument the EAT held that when reaching its decision, the Employment Tribunal had been entitled to reject the characterisation of the relationship between Uber drivers and Uber in the written contractual documentation.  It held the reality of the situation was that the drivers were incorporated into the Uber business of providing transportation services, subject to arrangements and controls that pointed away from their working in business on their own account in a direct contractual relationship with the passenger each time they accepted a trip.

In other words, Employment Tribunals will (and must), look behind contractual documentation if they suspect that it does not reflect the true nature of the working relationship.

Whilst Uber has confirmed it intends to appeal the EAT’s decision, the decision itself appears to be a clear indication of the direction of travel.  Organisations that rely on similar business models need to be alert to this recent decision as it makes them more susceptible to claims by individuals that they are workers and are therefore, entitled to worker status.  In addition they must consider the economic and PR implications of such claims against them.  

If you require any help or advice as a result of this development, or indeed anything to do with employment law, please do not hesitate to contact our Employment team:

Martin Stephen: mss@wjm.co.uk

Liam Entwistle:  lae@wjm.co.uk

Andrew Wilson: ajpw@wjm.co.uk

John Grant:        jzg@wjm.co.uk

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