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Workers Rights – What Does The Uber Case Mean?

Uber has been controversial since Day One. The ride-sharing service allows individuals with clean, safe cars to hire themselves out as paid drivers, and gives riders a chance to choose who drives them and for how much, rather than depend on fixed-price taxi consortiums.

Uber

The rider links their credit card to their account, and because of this, the driver is guaranteed to be paid based on mileage from the fare. This is far superior to a taxi driver, who takes a chance every time a fare gets into his cab. He has no guarantee that he will receive the agreed-upon payment at drop-off.

The driver can work as much or as little as he or she likes. He’s using his own car, and has no one to answer to. All he has to do is sign in as “available,” and the application lets him know if someone nearby needs a ride, and to where. When he has other commitments, he simply changes to unavailable, and fares can no longer contact him through the app.

With Uber, you would think that everybody wins, as everyone has a chance to make or save money. The drivers appear to be independent contractors, and Uber takes their cut off the top as booking agents. Fares pay less than they would with a black cab, and drivers and fares can be rated on the app, which female riders have appreciated. It gives them foreknowledge of whose car they’re getting into, whether it’s clean, and whether the driver is friendly and respectful.

However, Uber objects to the term “ride-sharing service.” They prefer to think of themselves as a technological platform, and their drivers are simply users of technology who have agreed to terms of use. The technology matches riders with drivers, Uber stays hands-off, and takes a small cut from the overall cost of the fare.

This difference in semantics went to employment tribunal, where drivers – represented by the GMB Trade Union lawyers – objected to the contractor title, arguing that they were subjected to the same contractual obligations as an employee would be, and therefore should have the same rights and benefits as an employee.

Their demand addressed things like minimum wage and holiday pay.

Uber argued that they are not an employer, merely a service that allows the drivers to connect with riders.

The tribunal disagreed, saying it was “unreal” to believe that Uber wasn’t a ride-sharing service. They sided with the union and workers. As explained on the Mayo Wynne Baxter law firm website, “The Tribunal challenged this portrayal and went behind the written agreement by looking at Uber’s recruitment process, publicity material, website and even tweets all of which demonstrated that they are very much in control. The Tribunal noted that in reality the nature of the relationship between Uber and the drivers was inconsistent with the notion of a self employed contractor because of this element of control.”

The case wrapped up at the end of October, 2016.

Workers rights – What does the Uber case mean?

Essentially, this case means that Uber will have to behave like any other employer or staffing agency, by providing sick pay, pension contributions, holiday withholdings, and other employee benefits.

For drivers, it may lead to them achieving a basic salary in addition to their fares, guaranteeing that they make the national minimum, even if they are not called out for a ride. However, they may also have to subject themselves to random drug testing, if Uber decides to make it a requirement of their “employment.”

By contrast, regular taxi drivers are still subject to only being paid by the ride, despite it being their full-time job and the long hours they put in every week. They have good weeks and bad weeks, just like the Uber drivers.

For the passengers, it may lead to higher prices, as all these changes will cost Uber dearly. Yes, they are a multi-billion pound company, but they achieved that success via their business model of individual drivers paying a share to use their technology. To suddenly become employer to thousands of drivers will cut into their bottom line. This is unfortunate, as many users appreciate the lower cost of Uber versus the black cabs and minicab companies.

Before anyone panics or celebrates, it’s worth it to bear in mind that at the time of the ruling, only two Uber drivers were affected – one of whom no longer even drives for the company. Uber will be appealing the decision before it has further-reaching applications. Expect to see more of this landmark case in the news in 2017.