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October 28, 2016

What does the decision in Aslam and Farrar v Uber (2016) mean in practice?

The short answer
To save you reading the rest of this article, yes, Uber drivers are workers… for now.

A slightly longer answer
The Collins online dictionary as of 28 October 2016 defines the gig economy as;

“the freelance economy”, and helpfully gives the following explanation;

“For the unknowing, the online platform connects people who have space to spare with those looking for a short stay at a competitive price. Services such as these, along with Uber, are driving the “gig economy”. Their platform enables people to become freelance service providers without the inspections and legal oversight that traditional lodging and cab industries are subject to.

Those portions that are underlined, based on this first instance decision, are now out-of-date.

The issue
Many will be familiar with the meandering and sometimes opaque tension between a person working under a contract of service or contract for service. The line became even more blurred when the term ‘worker’ was imported from Europe. In fact, in late 2015 Erinna Foley-Fisher of Albion Chambers wrote a very long piece analysing these same principles in relation to the adult entertainment industries, her article is here.  These aren’t new issues; they’re simply being applied to a new-style industry.
Very crudely, for the purposes of this piece, a worker falls somewhere in between contractor and employee and in terms of the UK legislation; it gives a worker more rights than a contractor but fewer rights than an employee.

The issue in the Uber case was whether the drivers were contractors, in the traditional sense of the word, or workers. The question of whether they were employees was never posed. Nevertheless, for a relatively low-margin business such as Uber (and a host of other similarly structured organisations), the extra rights and responsibilities provided to workers over those who are contractors, primarily the entitlement to the National Minimum Wage, may mean the difference between profit and loss.

The decision
I must stress, this is a first instance decision. It is not binding, though no doubt it will be cited extensively, by enthusiastic employment lawyers, over the coming months in Employment Tribunals up and down the country, seeking to apply the Uber decision a host of different scenarios.

The decision will be appealed. The gig economy, as currently structured, will not like this decision. Uber will not like this decision – so when advising our clients, we should tell them to expect many more months of uncertainty. There may even be a number of similar, non-Uber cases, where the decision at first instance finds similar scenarios not to fall within the definition of ‘worker’ and in due course, the EAT, the CoA and potentially the Supreme Court are likely to be called upon to decide this, and other similar cases.

On that note, I may take the night bus instead, at least I know where I stand…

To read the decision in full, please follow this link www.judiciary.gov.uk/wp-content/uploads/2016/10/aslam-and-farrar-v-uber-reasons-20161028.pdf

Richard Shepherd