A Threat to Uber’s Business Model: Uber loses a U.K Supreme Court ruling over drivers’ rights
Uber is being challenged by its drivers in multiple countries over whether they should be classed as workers or self-employed. An employment tribunal was held in 2016 over the same subject matter and the tribunal ruled in favour of Uber employees.
Uber appealed against the employment tribunal decision but the Employment Appeal Tribunal upheld the ruling in November 2017. It then took the case to the High Court, which upheld the ruling again in December 2018.
In this long-running legal battle, Uber appealed the original ruling all the way to the Supreme court in the U.K. The Supreme court unanimously dismisses Uber’s appeal. It ruled that Uber drivers must be treated as workers rather than self-employed. P.S: The ruling by the supreme court was Uber’s last appeal, as the Supreme Court is Britain’s highest court, and it has the final say on legal matters.
This decision could mean thousands of Uber drivers are set to be entitled to minimum wage and holiday pay, which could leave the ride-hailing app facing a hefty compensation bill, and have wider consequences for the gig economy.
For clarity sake, A gig economy is a labour market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs. The key word here is “gig”