Landmark UK court ruling finds Uber drivers are employees not contractors

A landmark court ruling in the United Kingdom has found that Uber drivers are employees and not contractors.

The decision could have worldwide ramifications, including here in Australia.

The ruling means drivers are entitled to industrial protections, including a minimum wage, sick pay and holiday pay.

It might also result in drivers back-paid the equivalent of more than $30,000 in entitlements.

Landmark UK court ruling finds Uber drivers employees

The case began two years ago when drivers James Farrar and Yaseen Aslam won a claim in the Employment Tribunal.

The tribunal ruled the men are “workers” under British law, and therefore, entitled to basic rights such as a minimum wage.

However, Uber appealed the decision, effectively freezing its obligation to implement the changes.

This week, the Court of Appeal affirmed the original decision, which will radically disrupt Uber’s business model.

The GMB union estimates Uber could owe drivers as much as 18,000 British pounds ($31,700) in back-pay and entitlements.

The background

Farrar took action following an assault he sustained from a passenger.

He claimed Uber took 10-weeks to provide information to police, prompting him to look closely at his contract with the company.

While Uber classified him and thousands of other drivers as independent contractors, the reality is they have little or no control over the running of their business.

Farrar said he has to work long hours just to break even.

“I realised that I’m carrying all the risk, and not Uber,” he told ABC News.

“And that’s when we began to look at the real underlying issue here, and that’s the lack of worker rights, the lack of protection, and that’s was the starting point.”

What the experts say

Miles Heffernan, Litigation Director at IR Claims, says the UK court decision is good news for Australian Uber drivers.

“The UK courts have emphatically determined that Uber drivers are employees, and not independent contractors,” he said.

“Therefore, I think it will only be a matter of time before we’ll see similar legal action here.

“If our courts reach the same decision, then Uber will owe a lot of back-pay to a lot of workers, and will have to seriously re-consider its business model.

“People who work in the gig economy deserve protections like all other workers – in particular the right to earn a minimum wage and superannuation.”

The UK case is not over yet – Uber has now appealed to the Supreme Court.

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