UK Supreme Court's Decision On Status Of Uber Drivers And Its Significance On Gig Economy

• Published date: 10 May 2021
• Subject Matter: Employment and HR, Contract of Employment, Employee Benefits & Compensation, Employment Litigation/ Tribunals
• Law Firm: Bryan Cave Leighton Paisner LLP
• Author: Mr Glenn Haley and Ian Cheng

Over the past decade, the rapid technological advancement has led to the emergence of the so-called "gig economy". This term often refers to a market system whereby platform companies engage temporary or freelance workers to perform "gig" work, often through digital platforms. Well-known examples are car ride companies and food delivery companies.

Gig workers usually are not paid a regular wage, but are paid for the "gig" work they do. They usually do not have a formal employment relationship with the platform companies, and have flexibility as to when and where to work. As such, many platform companies have tended to treat gig workers as self-employed persons or independent contractors, rather than their employees or workers.

The status of Uber drivers was at issue in the UK Supreme Court case of Uber BV v Aslam [2021] UKSC 5.

Background

Uber (the appellant) owned the Uber app which provides ride-hailing services and had been licensed to operate private hire vehicles in the UK. The respondents were private hire vehicle drivers, performing driving services booked through the Uber app.

In very broad terms, the UK employment law distinguished between three types of people:

(a) Those employed under a contract of employment.
(b) Those self-employed persons who are in business on their own account and undertake work for their clients or customers.
(c) An intermediate class of workers who are self-employed but who provide their services as part of a profession or business undertaking carried on by someone else.

The "employees" under (a) enjoy the highest level of employee protection, while the "workers" under (c) enjoy some (albeit a lower level of) protection, including minimum pay and holiday pay. The "self-employed" persons under (b) do not have any employment protection.

Supreme Court's decision

The main issue before the UK Supreme Court was whether, under the relevant statutory provisions, the drivers should be regarded as "workers" who undertook to perform services for Uber. It was not suggested by any party that the drivers were "employees". Therefore, the issue was whether the drivers fell within (b) or (c) above.

First, after considering the evidence, the UK Supreme Court rejected Uber's argument that Uber acted merely as a payment collection agent and/or booking agent for the drivers.

Next, the UK Supreme Court considered the statutory definition of "workers" , and found that the purpose of the relevant legislation was to protect vulnerable workers...