A ‘gig’ economy involves work based on people having temporary jobs or doing separate pieces of work, with each paid separately, rather than working for an employer. Uber is a service which uses an App to connect passengers with drivers of vehicles for hire. Once a passenger request has been received, Uber finds the nearest driver who has 10 seconds to accept the trip. Uber calculates the route. Once the journey is completed, the passenger pays Uber by credit or debit card. The driver is then paid a percentage of the fares on a weekly basis.

Uber have been identified as one of the key players in helping to expand the gig economy in recent years, including developing the trend from shifting away from formal employment relationships. However, that could now be affected by an ET’s decision in Aslam, Farrar and others v Uber, that Uber drivers were not self-employed people in business on their own account as Uber claimed, but in fact ‘workers’ within the meaning of the Working Time Regulations 1998, the National Minimum Wage Act 1998 and the Employment Rights Act 1996 and so entitled to the specific rights afforded to workers under those pieces of legislation.

For the Claimants to succeed they had to show that they came within the definition of a ‘worker’ in all three pieces of legislation, i.e. they work under a contract which requires them to do work, or provide services, personally for another party to the contract. They argued that Uber runs a transport business and employs drivers to that end whom Uber instruct, manage and control. Uber denied this arguing that they provide business opportunities and guide driver behaviour to ensure the common interest in providing a satisfactory ‘rider experience’ and ‘preserving the integrity of the platform’.

The ET decided that Uber does run a transport business. The notion that Uber is a mosaic of small businesses linked by a common platform was, to the ET’s mind, “faintly ridiculous”. It was also “absurd” to suggest that drivers enter into a contract with a person they do not know, to follow a route, and at a fare, prescribed by someone else. The drivers provide the skilled labour through which the organisation delivers its services and earns its profits. When a driver has the Uber App switched on, is within his authorised working territory and is able and willing to accept assignments, then he is working for Uber under a ‘worker’ contract. Therefore, for the 13 substantive reasons set out in Paragraph 92 of the judgment, the drivers are workers for the purposes of the relevant pieces of legislation.

This case rests on its own facts. As an ET decision, it is not binding and Uber have indicated that they intend to appeal. However, it shows the type of scrutiny to which gig economy organisations can be subjected to, which takes on even more significance as the BEIS Committee launches an inquiry into employment rights in the future world of work (see below) and HMRC is to launch a specialist unit to investigate companies who opt out of giving workers employment protections by using agency staff or calling them self-employed.

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