Uber suffered a significant labor defeat in Europe’s largest market on Friday when Britain’s Supreme Court ruled that drivers should be classified as workers entitled to a minimum wage and vacation time.
The case has been watched closely for its implications for the gig economy, as companies like Uber rely on a sprawling workforce of independent contractors to provide rides, food deliveries and house cleaning services.
Uber and others in the gig economy say its model gives people flexibility to choose when they work, while critics say it has eroded job protections and the traditional company-employee relationship.
The court ruled that although Uber says it is just a technology platform that connects drivers with riders, it acts like an employer by setting prices, allocating trips, requiring drivers to follow certain routes, and using a rating system to discipline drivers.
Lord George Legat of the Supreme Court said in a reading: “Drivers are in a position of dependency and subordination with respect to Uber, so that they have little or no ability to improve their economic situation through professional or entrepreneurial skills.” Rule. “In practice, the only way they can increase their earnings is to work longer hours while consistently meeting Uber’s performance metrics.”
Uber has struggled with UK drivers’ efforts to classify them as workers over the past five years, and they have appealed the decision all the way to the nation’s Supreme Court. Friday’s ruling is expected to initially affect the 25 drivers who filed the case, but it is seen as a precedent for others across the country.
After the decision, the labor court will decide how to reward the drivers and how the ruling will affect other drivers in the future.
Uber sought to downplay the decision, saying it would pressure the labor court to limit its scope.
The company said the ruling should only affect a small number of drivers, and that it would not require it to reclassify all of its drivers as workers.
The company said it will pay the court that it has made a number of changes to its business model to provide more protection for workers since 2016, when the case was first filed, such as offering drivers insurance if they fall ill or injured, and letting drivers refuse to ride certain rides with impunity.
“We are committed to doing more and will now consult every active driver across the UK to understand the changes they want to see,” said Jimmy Heywood, Uber’s Regional General Manager for Northern and Eastern Europe.
But some employment lawyers said the decision had broader consequences than Uber had suggested, and that it marked a significant moment in the broader labor debate about gig workers, whose role in the economy has grown during the pandemic.
Shauna Jolly, human rights and employment law attorney at Cloister Chambers in London, said the case has “much broader implications than the Uber case alone, and is likely to be seen as a watershed moment in employment rights for workers in the gig economy”.
Nigel Mackay, partner at law firm Lee Day that represents the drivers, said the decision would have a wide impact and that Uber should start providing drivers with a minimum wage and vacation time or risk facing a wave of similar cases from others and said none of the changes Uber made Since 2016 “it will not affect the central court’s finding that Uber drivers are workers.”
“Any Uber driver can now join the claim to receive compensation for Uber’s failure to provide paid vacation and to ensure drivers get at least the national minimum wage,” he said.
Uber drivers are currently paid for each trip, with Uber charging 20 percent of each fare. Drivers must pay for the car, insurance, and taxi license.
Uber and others in the gig economy are resisting efforts in other parts of the world to classify workers as employees of mixed success.
In France, Uber The decision is lost In the country’s Supreme Court last year that a driver has the right to be considered an employee. But in California, Uber and other companies have funded A successful poll In November elections to exempt them from a law that would have required them to hire drivers and pay for health care, unemployment insurance, and other benefits.
Britain, where Uber employs nearly 60,000 drivers, was one of the company’s most important markets, but also a source of legal trouble. In London, where Uber cars are ubiquitous like traditional black taxis, the city transport regulator has taken steps twice to investigate Uber taxi license canceled In recent years before the company approved new safety policies.
Mr. Mackay said he hoped the decision would provide support for workers and lawyers seeking stronger legal protection for those working in temporary jobs in other countries.
“People all over the world will follow this decision,” he said.