The UK Is the Latest Country to Tighten the Screws on Uber

For four years, the employment status of Uber drivers in the United Kingdom has been like a colorful beach ball: insubstantial, batted from court to court, appearing different depending on where you stand. On Friday, the highest court in the country decided: A group of 25 Uber drivers who brought a case against the company should never have been treated as independent contractors, justices concluded. Instead, the workers are entitled to national minimum wage, paid leave, rest breaks, and discrimination protection.For now, the decision applies only to the 25 drivers. But it’s the latest sign of governments around the globe pressuring Uber’s business model, and those of its gig economy siblings—including DoorDash, Lyft, Amazon, Instacart, and in the UK, the food delivery company Deliveroo. Lawmakers, jurists, labor unions, and organizers want the companies to treat their workers better, even as the companies remain unprofitable.
“Over the past 12 months, there’s been a pendulum swing by the courts towards protecting worker rights in the gig economy,” says Ruwan Subasinghe, the legal director of the International Transport Workers’ Federation, which represents nearly 20 million workers in 150 countries. Last March, France’s top court ruled that an Uber driver did not qualify as a self-employed contractor, opening the ride-hail and delivery company to tax liability. A similar ruling followed last fall in Italy. Belgium’s labor authority filed a court case challenging the worker status of food delivery workers last month. Just this week, judges in the Netherlands ruled that cycling couriers for Deliveroo do not qualify as freelance workers, and that Deliveroo must pay an hourly rather than per-delivery wage.Outside courtrooms, the Spanish government is set to release strict new rules changing the employment status of the country’s food delivery workers as soon as this month. And the European Union this month will begin discussing legislation that would govern platform-based work, with the goal of issuing new labor rules by the end of the year. The EU could, for example, loosen antitrust laws to allow gig workers to collectively bargain, a kind of coordination that today might be considered an illegal cartel.
Uber has argued for years that it is simply a tech platform, connecting business owners—people who own cars and want to make money—with customers who want rides and snacks. But Friday’s unanimous decision by the UK Supreme Court ruled that, unlike other independent contractors, Uber drivers don’t have control over key parts of their work. The court said drivers don’t establish their own contract terms, that they are penalized for declining too many ride requests, that they are evaluated—using rider ratings—as employees. Sure, the court said, Uber drivers theoretically get to choose what sort of car to use—but Uber vets the make and model first.
In response to the decision, Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe, stressed that the ruling only applies “to a small number of drivers who used the Uber app in 2016,” and that the company has made changes to its driver app since then. “We are committed to doing more and will now consult with every active driver across the UK to understand the changes they want to see,” he said. Uber did not immediately announce any changes to its service, but in the past has said it will raise prices if it is forced to treat more of its drivers as employees.
Similar arguments are playing out in the US. A 2019 California law restricted employers’ use of independent contractors . Soon after, a federal appeals court ruled Uber’s drivers should be treated as employees, entitled to minimum wage, workers’ compensation, and other benefits. In the end, Uber, Lyft, DoorDash, Instacart and others evaded both lawmakers and the courts by spending more than $200 million on a ballot measure that allows them to continue to treat workers as contractors, with some added benefits. Californians approved Proposition 22 in November.