EAT rules Uber drivers are workers

14 / 11 / 2017

In November 2016 we reported on the Employment Tribunal’s (ET) ruling against Uber that its drivers should be classed as workers and not as contractors or self-employed. Uber appealed the decision and the case was heard by the Employment Appeals Tribunal (EAT) in September 2017.

The EAT in the case of Uber BV v Aslam & Others [2017] has dismissed the appeal and confirmed the ET’s decision that drivers are “workers” and engaged on working time for the purposes of the Working Time Regulations.
Uber’s appeal centred around four main arguments:

  • That the ET had been wrong to disregard the written agreements between Uber and the drivers. In doing so, Uber claimed that the ET had disregarded the basic principles of agency.
  • The ET had been wrong to rely on regulatory requirements as evidence of the status of drivers as workers.
  • The ET had made a number of internally inconsistent and perverse findings of fact in concluding that the Claimants were required to work for Uber.
  • The ET had failed to take into account relevant matters relied on by Uber as inconsistent with worker status.

Sitting alone, Her Honour Judge Eady QC identified the determinative question: “When the drivers are working, who are they working for?

This was the question at the heart of the appeal. In answering it, the EAT reviewed the ET’s judgment and had regard to all the circumstances of the case. It held the following in response to Uber’s appeal:

  • As Uber drivers did not operate their own businesses and therefore did not enter into contracts with passengers, the ET was entitled to reject Uber’s argument that a relationship of agency existed between the parties. The characterisation of the relationship in the written agreements between Uber and the drivers did not therefore reflect the reality of the situation.
  • The EAT disagreed with Uber’s argument that the ET should not have relied on regulatory requirements as evidence of the status of drivers as workers. The EAT did not consider that the ET was obliged to disregard factors because they might arise from compliance with a particular regulation. HHJ Eady QC stated that:

“In the present case, personal service was a regulatory requirement but was also a relevant matter in determining worker status. An ET is not obliged to disregard such a factor, although it should see it in context, which may include the regulatory context. … It is all part of the factual matrix for the ET to assess.”

  • Looking at the entirety of the ET’s judgment, the EAT did not consider its findings inconsistent and found that Uber had not met the “high burden of showing that they were perverse“.
  • Where the ET’s findings of fact were challenged, even if these were not specifically set out in the Notice of Appeal, the EAT supported and confirmed the consistency of the ET’s approach.

Overall, the EAT was satisfied that the ET did not err in its approach or conclusions and was entitled to reject the contention that the contract was between the driver and passenger. Uber’s argument that they were simply an agent to this relationship, providing a technology platform to the drivers, was found to be false.

The decision is unlikely to result in the demise of Uber; rather (and subject to any appeal – Uber may well try to co-join its appeal with that of Pimlico Plumbers, which is due to be heard by the Supreme Court early next year) the fact that at law its drivers are “workers” will mean that Uber’s profits may take a dip – not least because it could face a significant number of claims from drivers who are in a similar position as Mr Aslam and the other Claimants, or because it has to change its business model so as to provide its platform to both drivers and customers so as to put these parties in direct contact. This model may require Uber to charge both the driver and customer a licence fee for using the platform, rather than, as currently operated, Uber exercising control over the driver and what the driver receives by way of payment for the work that the driver does.

At a really high level – political/socio economic level – the decision gives a signal to the gig economy that, as far as those that provide services to companies that operate in this “new” world, those companies have to do “the right thing” as far as securing worker rights is concerned.