Update: U-turn by Uber on workers’ employment rights

Uber has offered employment rights to all workers following its defeat in last month’s landmark court case.

uber verdict what it means for contractors inside IR35

Marking the end a four-year court battle between Uber and two of its drivers, the Supreme Court ruled against Uber, in that its drivers were workers, and not self-employed contractors, and were entitled to employment rights associated with worker status. 

Speaking to the BBC, Uber’s regional general manager for Northern Europe, Jamie Heywood, said that the Supreme Court ruling had given Uber “a path forward” to combine the protections drivers deserve under the worker status with the flexibility they want.

Uber has offered the following to all workers: 

  • National living wage once a trip has been accepted
  • Paid holiday time based on 12.07% of their earnings, paid fortnightly
  • Pension auto-enrolment with employee and employer contributions

inniAccounts CEO, James Poyser, reflects on Uber’s u-turn:

“Uber said originally that the verdict of worker status applied only to the “small group of drivers using the Uber app in 2016” who had brought the tribunal to the Supreme Court, and not “other drivers on the app” or “couriers who earn on Uber eats”. (Uber) Now they’ve decided to roll out basic rights and protections to all UK drivers.”

Worker employment rights include:

  • getting the National Minimum Wage
  • protection against unlawful deductions from wages
  • the statutory minimum level of paid holiday
  • the statutory minimum length of rest breaks
  • to not work more than 48 hours on average per week or to opt out of this right if they choose
  • protection against unlawful discrimination
  • protection for ‘whistleblowing’ – reporting wrongdoing in the workplace
  • to not be treated less favourably if they work part-time

They may also be entitled to Statutory Sick Pay, Statutory Maternity Pay, Statutory Paternity Pay, Statutory Adoption Pay and Shared Parental Pay.

Impact on inside IR35

“Ultimately, this means that taxing individuals like employees, without giving them the rights and protections employee status entitles them to, is untenable for organisations. 

“If end clients find contractors to be inside IR35, they’re going to have to start providing employment benefits and protections, or else run the risk of an employment tribunal not ruling in their favour. 

“It goes back to what we’ve always said: if you want a temporary employee, hire a temporary employee and ensure that you (not them) are paying for the protections and benefits they’re entitled to. However, if you want a supplier for an arm’s length relationship, without the burden of employment, then engage fairly outside IR35.”

A good source of free and impartial advice on employment rights is ACAS.

Uber. “An update on today’s Supreme Court verdict.” Uber blog, 19 February 2021, https://www.uber.com/en-GB/blog/supreme-court-verdict/.