Is the UK’s gig economy about to see a boom or bust?

As a five-year battle between the world’s biggest ride-share app and a group of its former drivers reaches the Supreme Court, unions warn that workers in the UK could face a total collapse of employment rights across the economy.

On Tuesday, July 21, Uber launched its final appeal against a decision which ruled that the company’s drivers were entitled to workers’ rights, including the national minimum wage and paid holidays.

The legal battle began in 2016 when a group of Uber drivers led by Yaseen Aslam and James Farrar took the company to court over workers’ rights.

Uber, which is based in San Francisco, has long argued that its drivers are self-employed rather than workers employed by the firm, and as such the company does not have to provide many of the benefits and legal protections afforded to other employees.

However, the initial tribunal, and the subsequent appeal, ruled that Aslam and Farrer were not self-employed contractors, but were ‘workers’ under the Employment Rights Act 1996, due to the level of control that Uber had over their work.

The result of this final appeal will dictate the future of the UK’s gig economy. If Uber loses the appeal then it will face paying tens of millions in compensation, and inadvertently pave the way for other gig workers with similar status across a host of industries.

Conversely, a successful appeal could see further cementation of the UK gig economy, with unions warning that millions more workers could be ‘pushed permanently into precarity’.

Worker Rights in a Gig Economy

In the past decade, the world has seen a surge in the number of companies ditching the traditional employment model in favour of the more casual ‘gig-economy’ approach. Supporters of this model say it gives individuals greater autonomy over their working hours, but critics, many of whom have first-hand experience of the industry, say it denies already vulnerable workers basic worker rights.

As Covid-19 continues to devastate the economy, employment specialists at Axiom Stone Solicitors have highlighted the specific issues self-employed workers face in the gig economy.

While worker status is technically still a form of self-employment, experts say it would guarantee basic protections for drivers, including the national minimum wage, SSP, protection against discrimination, and would force the company to commit itself to more health and safety obligations.

A spokesman said:

‘While there is no specific statutory provision giving an employee the right to time off work because of sickness, it would be unfair if an employer dismissed an employee for sickness absence without properly investigating the absence first. It may be that an employee is disabled under the Equality Act 2010 in which case the dismissal would also be discriminatory’.

As well as the severe lack of job security created by these arrangements, experts say it leaves workers with almost no rights when it comes to receiving payment. According to the legal advice website WorkRight, there is a key difference between receiving a wage, and being paid.

Writer Madaline Dunn said:

‘Many people have the misconception that wages and pay are the same things, well, fun fact of the day: they’re not! Pay refers to your monthly or hourly pay rate, however, wages encompasses a lot more. This refers to everything else you’re paid in connection to your job, including Holiday pay, bonuses, statutory payments like SSP and Maternity Pay, and payments made during suspensions on medical grounds’.

This lack of security has seen thousands of workers turn to employment solicitors for advice about their rights, with around 1,000 more Uber drivers making similar claims against the company. Most of these have been paused, pending the Supreme Court verdict.

However, despite the apparent ramifications for all involved, Uber said it did not intend on changing its business model.

Jamie Heywood, regional general manager for northern and eastern Europe, told the Guardian:

‘The vast majority of drivers want to work independently, and over a number of years we’ve made significant changes to our app to offer more benefits with total flexibility. Drivers can determine if, when and where they drive, but can also access free Axa insurance to cover sickness or injury, as well as maternity and paternity payments’.