Has the 'Gig' ended or will there be an encore? Uber lose appeal at EAT

17th November 2017 Employment

The eagerly anticipated Employment Appeal Tribunal (EAT) judgment was handed down in the Uber v Aslam and others on 10 November 2017. In a landmark ruling, the EAT confirmed that the Employment Tribunal's (ET) decision to classify Uber's drivers as 'workers' under the Employment Rights Act 1996, Working Time Regulations 1998 and National Minimum Wage Act 1998 was correct.

The importance of this decision cannot be underestimated, particularly for those working in the so called 'gig economy'. Unlike those individuals who are genuinely self-employed, (this is what Uber were seeking to argue was the correct status for their drivers), 'workers' enjoy certain rights such as the right to paid annual leave, national minimum wage, right to rest breaks etc.

The ET decision dismissed the complex contractual documentation that attempted to define the relationships between Uber, the drivers and the passengers as it did not respond to the reality of the situation. The ET concluded that the reality was the drivers were engaged as workers for as long as they were in the territory in which they were authorised to work, they were signed into the Uber app and were ready and willing to accept bookings.

The EAT confirmed that the ET had been right to reject the use of agency in the contractual documentation between Uber and the drivers, as the ET had made a correct determination on the real relationship between the parties (relying on a Supreme Court decision in Autoclenz Ltd v Belcher and ors).

The EAT stated that the ET were not ruling out the possibility that in some circumstances individual drivers might be seen to be operating as separate businesses, and as such, entering into direct contracts with passengers (an argument put forward by Uber) however, on the facts of the Uber case, the ET did not find this to be the position. The EAT also flagged that the ET were entitled to rely on regulatory factors to assist it in reaching its conclusion that the Uber drivers were workers.

On the working time argument, Uber stated that the ET had failed to take into account that even when signed in to the app, the drivers were free to accept or reject work and work for direct competitors of Uber. The EAT decided that as the ET had made a finding that drivers were expected to accept 80% of trip requests when signed in to the app, this expected high percentage of acceptances justified the ET's decision that once signed in, the drivers were at Uber's disposal.

Whilst cases like this are fact specific, the decision will still have far reaching consequences for other companies which operate similar working practices (known as the gig economy model), as workers under UK law are entitled to a number of protections. These include by way of example, to be paid NMW, annual leave and sick pay.

Uber have already indicated they intend to appeal the EAT decision and fast track it to the Supreme Court. There is very likely to be more to come before in this very complex area of employment law, as the other gig economy cases, such as the Pimlico Plumbers appeal has already been referred to the Supreme Court and the City Sprint couriers case is due to be heard in the EAT at the end of this month. Please check in with us regularly for further updates.

To discuss this or related matters please do not hesitate to contact myself or our employment team.

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Paul Chamberlain is a Partner and Head of Department located in Manchesterin our Employment department

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