Uber drivers are workers, not self-employed, Supreme Court rules

Uber drivers win landmark court case

Uber drivers have won a landmark case which now means they are entitled to certain workers’ rights and potentially thousands in compensation. If you need legal assistance, are interested in claiming compensation, or you have any questions about the ruling, Smooth Commercial Law can help.

The Supreme Court has ruled in favour of thousands of Uber drivers who had been fighting for certain legal rights, potentially leaving Uber in line to pay millions in compensation. Uber drivers will now be classed as workers, not self-employed, which means thousands of drivers are now entitled to a minimum wage and holiday pay.

This is a huge win for Uber drivers around the country who have been fighting for worker status since James Farrar and Yaseen Aslam took them to an employment tribunal in 2016. After nearly five years of appeals, the Supreme Court, the UK’s highest court, had its final say on the legal matter by ruling that Uber drivers are indeed workers and should be entitled to certain rights.

In addition to the legal rights now granted to Uber drivers, many drivers may potentially be owed thousands in back payment compensation. If you believe you have a claim, get in touch today to see how our expert legal team can help.

What was the Uber Supreme Court ruling?

Speaking in February 2021, Lord Leggatt stated that the Supreme Court had unanimously dismissed Uber’s appeal that it was an “intermediary party”. He also stated that Uber drivers should be considered to be working not only when driving a passenger, but whenever logged into the app.

The court came to this conclusion based on a few facts:

  • Uber set the fare which means they dictate how much drivers can earn
  • Uber set the contract terms and drivers have no say in them
  • Request for rides is constrained by Uber who can penalise drivers if they reject too many rides
  • Uber monitors a driver's service through the star rating and has the capacity to terminate the relationship if after repeated warnings this does not improve

Using these factors, the court determined that drivers were in not in a “self-employed” position.

Why were Uber drivers unhappy?

Disgruntled Uber drivers have hit the headlines ever since the initial court battle in 2016. The “independent contractors” have been ineligible for minimum wage, overtime, worker’s compensation insurance and other benefits afforded to employees.

Mr Aslam, who brought the initial claim against Uber, stated that Uber’s practices made him leave the trade as he could not make ends meet. Many, he pointed out, feel trapped by Uber’s system, particularly as fares are down 80% due to the pandemic.

He believes that this ruling is five years too late, and that “someone somewhere, in the government or the regulator, massively let down these workers, many of whom are in a precarious position”. He continued:

We are seeing many of our members earning £30 gross a day right now. If we had these rights today, those drivers could at least earn a minimum wage to live on.

What were Uber arguing?

Throughout the legal battle, Uber have argued that it is classed as a booking agent, which hires self-employed contractors to provide transport. Through this process, Uber is not currently paying 20% VAT on fares.

Uber had also argued that, if it were to treat drivers as employees, then it would only count the time during journeys when a passenger is in the car. This was a key point on which the Uber drivers won, as many Uber drivers typically spend time waiting for people to book rides on the app.

What does this ruling mean for Uber drivers?

The ruling means that Uber drivers will now be afforded certain legal rights. These rights include:

  • Getting paid at least the National Minimum Wage
  • Protection against unlawful deductions from wages
  • Paid holiday
  • Protection against unlawful discrimination

Drivers who have joined a claim can also potentially claim compensation. This ruling means many Uber drivers can received compensation for Uber’s historical failures to provide them with workers’ rights.

The compensation awarded will be based on how much holiday pay a driver should have received historically, and whether they received below the minimum wage. If you would like more information on this, Smooth Commercial Law can assist.

How much compensation could Uber drivers be entitled to?

Every case is different, and the compensation you are owed will depend entirely on when you first became an Uber driver. We will keep you updated every step of the way in relation to how much compensation you could receive.

This compensation you can claim is for two things:

  • Back payment for unpaid holiday
  • Compensation if you received less than the National Minimum Wage, after expenses

If you speak to one of our team, we will clarify exactly how much you might be able to claim. Reports suggest that around 20% of the Uber’s UK drivers have already launched a claim. Get in touch today to join them. 

In addition to this, Deutsche Bank have estimated that a worst-case scenario for Uber would require them to pay $2.5 billion in VAT back-taxes.

How can Smooth Commercial Law help?

Are you an Uber driver? Would you like to know if you could be entitled to thousands in compensation? Our expert employment solicitors can guide you through your Uber compensation claim and tell you quickly whether you are eligible.

Our team work on a No Win, No Fee basis, meaning you pay nothing to us in the unlikely event your claim is unsuccessful. We can also provide assistance with general employment law questions now that you are classed as an employee, and the implications of that.

If you are one of the thousands of Uber drivers that has been affected by this court ruling, get in touch today to find out how we can help. You can contact our experienced Employment Law team by calling 0800 046 9976 or by putting in an enquiry form here.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.