Uber heads to court to appeal UK workers' rights ruling

Key Points
  • Uber appeals a U.K. ruling that its drivers should be considered workers and therefore deserve to be entitled to a minimum wage and other benefits.
  • Uber argues that its drivers, which it calls "partners," are self-employed and more akin to contractors than workers employed directly by the firm.
  • The IWGB, the labor union facing Uber in court, staged a march against the so-called gig economy on Tuesday.
A phone displays the Uber ride-hailing app on September 22, 2017 in London, England.
Leon Neal | Getty Images

Uber is appealing a ruling that its drivers should be treated as workers at the U.K.'s Court of Appeal, the second-highest court in the land.

The appeal relates to a 2016 employment tribunal ruling that Uber drivers James Farrar and Yaseen Aslam were working for the company, meaning they should be entitled to a minimum wage and holiday pay, among other rights.

The ride-hailing firm lost an initial appeal against the ruling at the Employment Appeal Tribunal last November. Uber then tried to take the case to the Supreme Court, but was blocked from doing so, meaning it would have to go through the Court of Appeal first.

Uber has long argued that its drivers, which it calls "partners," are self-employed and more akin to contractors than workers employed directly by the firm.

"Almost all taxi and private hire drivers have been self-employed for decades, long before our app existed," an Uber spokesperson said in an emailed statement Tuesday. The spokesperson pointed to a recent Oxford University study which found its drivers make £11 ($14) an hour, more than the living wage in London — £10.20 — a non-compulsory hourly rate that takes everyday living costs into consideration.

"If drivers were classed as workers they would inevitably lose some of the freedom and flexibility that comes with being their own boss," the spokesperson said.

Uber's representative added: "We believe the Employment Appeal Tribunal last year fundamentally misunderstood how we operate. For example, they relied on the assertion that drivers are required to take 80 percent of trips sent to them when logged into the app, which has never been the case in the U.K."

"Over the last two years we've made many changes to give drivers even more control over how they use the app, alongside more security through sickness, maternity and paternity protections. We'll keep listening to drivers and introduce further improvements."

The labor union representing drivers Farrar and Aslam, the Independent Workers' Union of Great Britain (IWGB), staged a march against the so-called gig economy on Tuesday. In such an economy, work is seen as more flexible and companies tend to hire independent contractors and freelancers on a temporary basis.

The protest consisted of Uber drivers, Deliveroo couriers, outsourced cleaners and fast food workers on Tuesday. It was backed by U.K. Labour Member of Parliament Frank Field, who is one of a number of lawmakers in the country that have expressed concerns about Uber's attitude to workers' rights.

Farrar and Aslam are being represented by solicitors Paul Jennings and Rachel Mathieson of Bates Wells Braithwaite.

"Uber has acquired a dominant position within the market incredibly quickly," Jennings said in a statement ahead of the hearing.

Jennings added: "A key issue in this case is whether Uber has mischaracterised the employment status of its fleet and in so doing failed to observe fundamental employment rights. The financial implications of this judgment could be very significant."

The Court of Appeal hearing will take place over two days — Tuesday and Wednesday. The legal challenge is being seen as a key indicator of mounting concerns over the gig economy. Experts say a loss for Uber could hold ramifications for the business model of similar firms in the space, like Airbnb and Deliveroo.

Uber currently has roughly 45,000 licensed drivers operating in London and more than 3.5 million riders in the U.K. capital using its app. The firm announced a tie-up with insurance provider AXA earlier this year to offer European drivers insurance coverage for a range of matters including injury, sickness and family leave payments.

The latest development in its legal battle over the employment status of drivers comes just four months after the firm was granted a temporary license enabling it to continue operating in London. The U.K. capital's transport regulator, Transport for London, had previously decided not to renew Uber's London license, arguing it showed a "lack of corporate responsibility" in regard to "public safety and security."

It also comes as Uber gears up for its highly anticipated initial public offering in 2019, a float which reports have said could value the company at more than $100 billion.

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