In a much awaited ruling, an Employment Tribunal has determined that two drivers who provide services to the taxi app Uber are “workers” under the Employment Rights Act 1996 (“the ERA”).
The ET Judgment was handed down on 28 October 2016.
Although this decision will almost certainly be appealed and could end up in the Supreme Court, it will have sent shockwaves through the “gig economy” where other companies such as Deliveroo and Hermes have based their business models on the premise that they are working with “self-employed” drivers rather than engaging with them as part of the workforce.
This means that they will be entitled to a limited number of employment rights as “workers”. Amongst other rights, they will be entitled to:
- 5.6 weeks' paid annual leave each year
- a maximum 48 hour average working week, with rest breaks
- the national minimum wage and the national living wage
- protection of the whistleblowing discrimination legislation.
As they are not employees, they will not be entitled to:-
- the ability to claim unfair dismissal after two years’ service
- the right to a statutory redundancy payment
- TUPE protection, if Uber were to sell its business
As a “worker”, an individual can make claims in respect of holiday pay, sick pay, unpaid wages and failures to pay the national minimum wage as an unauthorised deduction of wages under the ERA (as well as a claim for unpaid holiday pay under the Working Time Regulations 1998).
Readers may be interested to note that employment tribunals have the ability to look at what is called a “series of deductions” over a period of time e.g. deductions in May, June and July, however, they can only look at complaints going back two years in time from an unbroken series of deductions.
Put into practice, if there have been deductions in May, June, July, and August was correctly paid but then the deductions started again in September, the chain would be broken and the claim could only be brought for May, June and July.
Stay tuned: Uber will very likely appeal this ET decision but the process will take many months. In the meantime, the chances of existing Uber drivers bringing tribunal “worker” claims together with other individuals working with other “gig economy” companies is only increased. Any individuals who think that they might be affected by this decision should bring tribunal claims (usually within three months) on the assumption that they are 'workers', and ask for the hearings to be put on hold pending Uber’s appeal. Where there has been a series of deductions, the time limit starts running from the last deduction or payment in the series.
If you are a “worker”
If you have not been paid what you think you are due please contact us on 0808 168 5550 or email firstname.lastname@example.org to discuss the possible next steps and measures.
If you are an employer
If you are concerned that your business has not been making accurate payments to your employees or workers we can review your business situation and provide pragmatic and proactive advice to help safeguard against possible claims. Where a dispute has arisen we can help you quickly resolve it in a commercially pragmatic way, often using a negotiated settlement and staying away from a tribunal or court room.