Uber v Aslam - Employment status

Court of Appeal – December 2018 

The Court of Appeal (CA) has dismissed Uber’s appeal against the employment tribunal (ET) and Employment Appeal Tribunal’s (EAT) decision that drivers engaged by Uber were not self-employed contractors, but fell squarely within the legal definition of ‘worker’ under the Employment Rights Act 1996, the Working Time Regulations 1998 and the National Minimum Wage Act 1998.

This case concerns the claim from two London-based Uber drivers that they should be classed as ‘workers’ and not ‘self-employed contractors’, despite being labelled as such within Uber’s contractual documentation. If the drivers were ‘workers’ they would be entitled to numerous employment rights from Uber, such as paid holidays, the national minimum wage and whistle-blower protection, something that would not be available if they were ‘self-employed.’ 

ET

The tribunal decided that the drivers were ‘workers’ despite Uber’s argument that it simply acted as an ‘intermediary’ for the drivers and their passengers. They found that whilst it could be possible for an organisation to operate in the way that Uber claimed it did, on analysis of its operation, statements and systems, this was not the case here. The ET went on to list eleven numbered points that they believed demonstrated the reality of the arrangement, including the fact that the drivers were not aware of their passenger’s identities, picked them up to take them to unknown destinations and received payments at a fee calculated by Uber.

EAT

Uber’s appeal to the EAT was dismissed, confirming the tribunal had been correct in their decision. The EAT reiterated that drivers were incorporated into Uber’s business and were subject to such control that they could not be working in business on their own account. As this ‘true relationship’ had been established, the ET was entitled to reject the agency label used in the contractual documents. They agreed that the drivers were essentially ‘working’ once they entered the relevant territory and switched their app on.

Court of Appeal

Uber appealed again to the Court of Appeal, who upheld the decisions of the ET and the EAT by a majority. Citing the principles of the Supreme Court’s decision in Autoclenz Ltd v Belcher, the CA approved the reasoning of the ET through their reliance upon a number of features of Uber’s working arrangements being inconsistent with the driver having a direct contractual relationship with the passenger. Therefore, it was confirmed that the practical reality of the relationship between Uber and the drivers meant the contractual terms relied upon by Uber could be disregarded.

Uber were granted leave to appeal to the Supreme Court, which it has confirmed it will be pursing. Subject to appeal, the case will go back to the ET for the claims of unpaid holiday pay and under-payments of wages to be determined.

Note for employers

It is imperative that organisations correctly categorise those who work for them. Despite what the terms of a contract might say, tribunals have the ability to assess the reality of the situation. If the relationship between the parties does not reflect what is outlined in the contract, tribunals can determine that individuals are a different employment status and are determined to additional employment rights. This can leave an organisation liable for claims of holiday pay, the minimum wage, detriment for whistleblowing or even pension contributions.

It should be noted that there was a dissenting judgement from Underhill LJ in the Court of Appeal, who argued that there was no inconsistency between the working arrangements presented here and those commonly applied to taxi and minicab-owner drivers who also booked their passengers through an intermediary; something he labelled a ‘well-recognised model for relationships in the private hire car business’. On appeal at the Supreme Court, the driver finding may yet be overturned.

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