Worker Rights and Good Practice (Surviving Uber)

THE STATUS QUO?

When Messrs Farrer and Asleem were successful in their tribunal many thought that was the end of the matter. Uber appealed the tribunal decision, which was dismissed. The appeal was then dismissed at the Court of Appeal, and most recently at the highest court in the land – The Supreme Court. Those Uber drivers are now classified as workers. 

We know (continuing on from my last PHTM article) that Uber proceeded to issue a press release, superficially offering worker status to all who want it. That statement hasn’t yet stood the test of closer inspection of what is really happening to Uber drivers.

We know that the decision will (might?) have wider consequences to the gig economy. Will we eventually have delivery drivers waiting outside a fast-food joint to deliver its hot steamy fare, being entitled to minimum wage? Well, Deliveroo’s investors certainly think so. The apps currently depend on having thousands of workers on unpaid standby.

WHO SAYS WHAT AND WHY?

David Harmer, Markel’s Groups Status Expert Supremo points out:

“The drivers’ subordination to Uber, resembles the ‘dependent contractor’ outlined in Matthew Taylor’s 2017 ‘The Taylor Review of Modern Working Practices’. Uber’s structure only allows drivers to increase earnings by working more jobs, which drivers are less likely to do if waiting time were paid. As has happened during the pandemic, drivers waste time and petrol without any financial compensation when there are fewer jobs.

Aside from this, many thinks this will, or should open the doors for the HMRC.

Employment lawyer and expert Darren Newman highlighted in his piece ‘End of The Road’.

that it is time for HMRC to take on the score of a lifetime.

‘Now that we know for sure that Uber drivers are workers, compliance officers can set about the task of assessing whether or not Uber has complied with their obligations (shouldn’t be tricky – they clearly haven’t) in respect of the minimum wage and set about calculating the amount of arrears that are due. They should then issue what might be their biggest ever Notice of Underpayment – plus a penalty of up to £20,000 per worker.’

If no action is taken, HMRC risks losing all credibility, seen to be focusing on squeezing the little guy instead of going after the real crooks. If HMRC can get Uber to cough up, then Uber drivers will have more confidence claiming against the tech behemoth. It is a double loss for Uber and a double win for workers’ rights.

Charlie Thompson, employment partner at Stewarts Law, believes that little will actually change.

‘Other gig economy businesses and workers will take notice, and we may see a spike in claims, but because every employment case is decided on its own facts, we will still see arguments that all business shouldn’t be treated like Uber’. Two gig economy businesses are never the same, with the technology commonly the differentiating factor, even if drivers or users obtain jobs in the same way.

From a legal point of view, the rights of drivers as workers are significant. Uber is no longer allowed to define those that work for them in the way that most benefits them, that cannot be discounted. Uber is forced to admit that their drivers actually work for them, which is significant.

Co-lead claimant James Farrar, made an emphatic statement about the dream that Uber sells to drivers:

‘Uber drivers are cruelly sold a false dream of endless flexibility and entrepreneurial freedom. The reality has been illegally low pay, dangerously long hours and intense digital surveillance.’

WILL THE DECISION TRANSFORM THE TAXI AND PRIVATE HIRE INDUSTRY?

The Actual findings

Although the drivers were free to determine when and where they worked, the Supreme Court highlighted five points from the tribunal’s judgement as worthy of note:

1)         The remuneration was fixed by Uber: drivers could not determine how much passengers were charged.

2)         Not only was Uber’s agreement with the drivers entirely dictated by Uber, so too were the terms on which drivers transport passengers.

3)         Uber, not the driver, retains absolute discretion about whether it accepts a ride: the driver is not informed of a destination until a job is accepted, removing their right of refusal due to drop-off location. Moreover, the driver is penalised if they refuse too many jobs.

4)         Uber exercises a significant degree of control over the way in which the driver p   provides services, with rating systems tantamount to performance management.

5)         Uber restricts communication between driver and passenger: it is Uber’s passenger, not the driver’s.

The judgement in truth teaches us that ‘superficial’ changes to contract terms are simply not sufficient when deciding to treat people as self-employed.

Many issues were touched on, such as what and where is ‘work’.  In this example, does an app driver engaged and unengaged (passenger or no passenger) travel, add up to their total working hours, so how do their earnings show per hour pro rata. You would think that A purely self-employed driver does not actually start earning until his punter is in the back.

There were also some grey areas regarding app drivers accepting work from multiple apps and whether that affects their worker status during the waiting time.

However, in the end, the judgement amounts to the three things for those 26 app drivers we’ve outlined already: holiday pay, pension contributions and National Living Wage.

Uber may not even bear the brunt of added costs, which are likely to be passed on to the customers. When New York City’s minimum wage law came into effect in 2019, Uber simply raised its prices in the city to remain profitable.

Yes, But What does it Actually Mean to You?

Let us look at what this actually means to you today. Workers Rights as per ‘The Taylor Report’ will be a critical part of our future. We just don’t know quite how yet?

If you have already taken the time to bring in a suitable professional and addressed the engagement of your self-employed workforce, taken into consideration your working practices, and the importance of those practices being properly reflected in a written contract, that contract is as relevant as it was before the Uber judgement.

Many of the points picked up by the judgement are usually already in the sights of a status professionals like us.  It has been observed that Uber’s contract was not the traditional Contract for Services that many of you have or should have, with your subbies.  Meaning the Supreme Court judges actually made their decision based on the specifics of the Uber arrangement.

We know that all cases which might come before Tribunals, will need to be forensically examined based on the specifics of their own contracts and working practices. Even after Ubers announcement, we still don’t have a definitive legal answer to what constitutes working hours to allow us to set a minimum wage in this case. A tribunal does not create law, just something to be ‘considered’ for the next tribunal.

However, I have no doubt many more drivers will seek to go to tribunals, which will possibly lay the groundwork in the future for a sea change in sub-contractor to main contractor relationships. That is however a little way off, a closer issue will probably be copycat tribunals brought by   sub-contractors motivated to ‘try their luck’.

What they had were complicated and unclear working practices hidden behind lots of tech talk and weighty legalese. The point is nothing has really changed advice wise. I have always said that a standard templated contract which does not reflect reality, will not protect businesses from employment status and worker status claims.

Your contract terms, media, contractor handbooks or training manuals for subcontractors as well as your day-to-day working practices must be considered as a whole to establish whether your subcontractors can legitimately be seen as self-employed.

The decision today does not give all drivers protections and guaranteed work or money, or the right to sick pay, or the right to be ceased without due process. Uber was bought to task for not offering its workforce what the court decided was basic rights.  We need as a trade to continue to seek to attract and retain drivers, by good practice. And we still have the chance to do that.

Gary Jacobs

Gary is a director of Eaziserv, a compliance and status consultancy specialising in ground transport. www.eaziserv.co.uk