Ride-share giant Uber on Friday lost its challenge to a British court ruling that said the company must offer certain benefits to drivers, treating them as employees rather than contractors.
The original lawsuit was filed against Uber in October 2016 by two former drivers who argued the company denies basic labor rights, like holiday pay and minimum wage. A British court agreed and Uber challenged the decision.
Friday, an employment tribunal court in London upheld the lower court’s ruling — emphasizing that the structure of Uber’s labor model forces the company to treat drivers the same as other employees under British and European Union laws.
“If the reality is that Uber’s market share in London is such that its drivers are, in practical terms, unable to hold themselves out as available to any other [company], then, as a matter of fact, they are working at Uber’s disposal as part of the pool of drivers it requires to be available within the territory at any one time,” Judge Judge Jennifer Eady QC wrote in her ruling.
Uber has argued that its drivers should be subject to the same rules as “self-employed” British taxi operators. Eady concluded that the structures are not the same and that Uber must pay its British drivers a “national living wage.”
“The notion that Uber in London is a mosaic of 30,000 small businesses linked by a common ‘platform’ is to our minds faintly ridiculous,” the lower court ruled in July. “Drivers do not and cannot negotiate with passengers.
“They are offered and accept trips strictly on Uber’s terms.”
The San Francisco-based company could continue its battle, by appealing to Britain’s Court of Appeal or even the Supreme Court.
“Almost all taxi and private hire drivers have been self-employed for decades, long before our app existed. The main reason why drivers use Uber is because they value the freedom to choose if, when and where they drive and so we intend to appeal,” Uber U.K. acting general manager Tom Elvidge said in a statement Friday.
“The [ruling] relies on the assertion that drivers are required to take 80 percent of trips sent to them when logged into the app. As drivers who use Uber know, this has never been the case.”
Experts say the ruling could have a substantial impact on Uber’s British business model, as well as those for similar companies who rely heavily on contractors.
Friday’s ruling comes as the company is appealing the loss of its operating license in London, over concerns about the way it conducts background checks when hiring drivers.
By Doug G. Ware