Uber and the Rise of the ‘Gig’ Worker

by Amy Cousineau Massey, 09 November 2016

It’s been a bad week for the American worldwide transport company Uber.  An employment tribunal has just awarded two so called ‘self-employed contractors’ worker status.

As a result, the claimants, who are engaged as drivers by Uber on a contractor basis, will actually be entitled to the enhanced rights that are afforded to ‘workers’.

This means that the drivers will be entitled to 28 days paid annual leave (pro rata), a maximum average of 48 hours working week and rest breaks and the national minimum wage, amongst other rights afforded to workers.

As the drivers were not deemed to be employees, they will not be entitled to unfair dismissal, redundancy rights, protection afforded by TUPE or other rights reserved for employees.

For now the ruling is specific to the two drivers who brought the challenge, however it is highly likely that any other challenges on status would receive the same finding, even though the employment tribunal decisions are not binding authority.

What does the future hold for Uber? 

Going forward it seems likely that Uber will appeal this significant decision.

The decision is significant.  For Uber it will mean a complete overhaul of their business plan and structure. It is also a reminder that the tribunals, as always, are prepared to look at a situation in the round when interpreting contracts.

Other gig economy businesses like Deliveroo and Air BnB will be urgently reviewing their business structures and taking legal advice.

Gig economists propound that this style of working allows for work-life balance and ultimate flexibility.  However, the trade-off is that income is not guaranteed and there is no job security. 

Gig participants, such as Air BnB hosts and Handy (an odd job service) also find themselves subjected to ratings systems whereby clients can rate their services.  Ratings by the user are decided on a whim and can be somewhat arbitrary creating an unregulated form of performance management.

The decision serves as a stark warning for all businesses who engage self-employed contractors.  The risk is that contractors who have been considered ‘self-employed’ are actually deemed to be workers or employees, which would have a significant financial impact on any business.

Contact our employment law solicitors

For further details on protecting your business contact our employment law solicitor in BournemouthAmy Cousineau Massey by email, amycousineau@steeleraymond.co.uk, or by telephone on 01202 204 505.

Image by Aaron Parecki

Author

Amy Cousineau Massey

Solicitor
Meet the rest of the team

Contact us

We will only use this information to handle your enquiry and will not share it with anyone else.

OUR EXPERTS SHARE THEIR KNOWLEDGE & EXPERIENCE

Related insights

Business

Steele Raymond shines in Legal 500 for the 12th consecutive year

Business

How to build and secure value in your business

Business

Steele Raymond Boosts Legal 500 Top Tier Rankings for the 13th consecutive year

We would love to hear from you

Get in contact with us today

Contact us