Uber drivers are not self-employed
In the eagerly anticipated case between Uber and its drivers, the Employment Tribunal (ET) has concluded that the drivers are workers as opposed to self-employed contractors. As such, they will be entitled to rights such as the national minimum wage, paid holiday and statutory sick pay.
Much of Uber’s defence was focused on its contracts and associated documentation, which went to great lengths to confirm that Uber was simply a technology platform that allowed drivers to operate their businesses. However, the ET was forthright in finding that the arrangement between the parties was not one of a collection of thousands of small businesses linked by a common platform, going as far as calling that proposition ‘faintly ridiculous’.
In considering the true relationship, the ET noted several indicators pointing away from self-employment, such as Uber interviewing drivers, fixing fares, requiring drivers to accept trips, operating a rating system akin to performance management and being able to unilaterally amend the drivers’ terms. In addition, Uber was tripped up by previous written and oral statements referring to ‘our drivers’ and ‘providing job opportunities’.
As well as being a potential test case for other claimants working under similar circumstances, the decision serves as a reminder that an ET will look behind the terms of any contract when deciding on employment status. We have therefore outlined below some of the key markers of employment, self-employment and worker status.
In general terms, an individual is likely to be an employee if there is ‘mutuality of obligation’, meaning the company is obliged to provide work and the individual is obliged to do it. In addition, a requirement for the individual to do the work personally (rather than providing a substitute) as well as control over how the work is done resting with the company will normally indicate employment status.
Conversely, if an individual is able to pick and choose the work that they undertake and is able to provide a substitute rather than doing the work personally, he or she may be self-employed. Other indicators of this status are that the individual provides their own equipment and assumes financial risk for any losses arising from the work.
Worker status can be more difficult to define as there may be indicators of both employment (such as control by the company) and self-employment (such as no mutuality of obligation). An example of this is casual workers who are free to refuse offers of work, but once an offer is accepted they must do the work as directed by the company.
Ultimately, as was the case here, it is for an ET to decide which status applies to a particular relationship, taking into account the arrangement as a whole and not just what is in black and white.
If you have any questions on any of the issues raised in the above article, such as the employment status of individuals carrying out work for you, please contact Seanpaul McCahill.