On 10 November, 2017, the UK Employment Appeal Tribunal pronounced its decision on a crucial appeal apropos of the employment status of Uber drivers. It upheld the UK Employment Tribunal’s decision that Uber drivers were “workers” within the meaning of Section 230(3)(b) of the UK Employment Rights Act of 1996. This finding was of a significant import, because of the fault-line in the domain of “gig-economy” workers. In the recent times, there have been a big outrage and protests by the “gig economy” or “platform-based work” workers, against their working condition and pay-grade. The gig employers are now facing a legal reckoning across the world.
In the above case, Uber had contended that its drivers are independent workers, and that the “Uber App” is only a means formulated to facilitate the drivers in searching customers. That being so, Uber has no obligations towards the drivers under labour law (which regulates the relationship between employers and workers).
On the other side, drivers submitted, that they are, essentially, working for Uber as its employees, and on that account, Uber is answerable to comply with various obligations under statutory labour laws – that may extend to obligations of minimum wages, pay-scale, no arbitrary firing, et al.
Consequently, the Employment Tribunal found that the drivers were “workers” and that they were “working” whenever they (a) had the Ubers’ app switched on; (b) were within the territory in which they were authorised to work; and (c) were able and willing to accept assignments.
In this light, the judgment(s) in relation to the affiliation between the “gig” economy, and the labour rights were of significant importance, as they acknowledged the gig economy within the ambit of the labour law regime.
The Uber then appealed the decision to the Supreme Court. In a judgment delivered on 19 February, the Supreme Court of UK dismissed the appeal and upheld the findings of the Employment Appellant Tribunal.
The Supreme Court held that the transportation service performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Drivers are in a position of subordination and dependency in relation to Uber such that they have little or no ability to improve their economic position through professional or entrepreneurial skill.
The judgment is, primarily based upon the following premises and projections: firstly, in sooth, the (im)balance between Uber and its drivers reflects a level of control exercised by the former that is discordant with a general agency relationship. Essentially, the Court’s finding at the second stage of appeal was based on the premise that “the drivers do not market themselves to the world in general; rather they are recruited by Uber to work as integral components of its organisation”. For example, Uber recruits drivers, and controlls key information in regard to passenger details, which it doesn’t share with the drivers. Further, the drivers have minimal control over the route and the fares, and Uber controls the drivers’ employment through the system of “ratings”, and regularly issues “advice” or “recommendations” to drivers using the “app” or the “platform”. Therefore, the platform’s inherent hierarchical structure seeks to settle corporate control and destabilizes individuals’ autonomy or choice. The judgment rightly upheld this argument.
Secondly, in a market economy, there exists a real imbalance of power between workers and the employers. Intuitively, to counter that force, the model is to strengthen the workers, so that they can face employers as equal bargaining partners. This takes place through trade unions, rights to do strike, lock-outs, et al. The UK Supreme Court by affirming the Uber drivers as a “worker” has effectively given them the power to form association, thereby revolutionizing the area of gig workers, by employing them their democratic right.
The main contention, therefore, against the gig economy is, that the workers are not genuinely self-employed persons, independent from the platforms and their users. The Court, while adjudicating this contention, has rightly upheld its substance and nature. Otherwise, in the absence of democratic rights to the gig economy workers, with nearly unlimited supplies of labour and an absence of accountability placed on platform-employers, instability of workers would continue. In this backdrop, the judgment of UK Supreme Court is a welcome step. The only possible solution, especially during the time of a pandemic, where the gig or platform economy is at the boom, the need is to extend the both substantive labour rights, and also set up a detailed procedure for the resolution of disputes between employers and employees for the gig economy workers.
Vaidushya Parth is reading law at the NMIMS School of Law. He writes on Constitutional Law, Procedure, and Economics.