Blog News What Does Uber’s Case Mean for the Future of the Gig Economy?

What Does Uber’s Case Mean for the Future of the Gig Economy?

Someone holding a phone representing the future of the gig economy
Smart Recruit Online Feb 19, 2021 News

Now that the UK Supreme Court has ruled that Uber drivers are actually ‘workers’, what does this mean for the future of the Gig Economy as we know it? 

In this landmark case, the Supreme Court has now ruled that drivers using the Uber App must be classified as workers, rather than self-employed contractors.

OK, so this has been going on for some time and Uber themselves have already lost three previous cases at the UK highest court of appeal, but this was Uber’s last chance to overturn appeal rulings in 2017 (Employment Appeal Tribunal) and 2018 (High Court).

The courts had been clear all along that the drivers were workers for the purposes of the Employment Rights Act 1996, the National Minimum Wage Act 1998 and the Working Time Regulations 1998 and as such they were entitled to the protections afforded under the legislation.

 

What does this mean for Uber?

the uber app on a phone representing the future of the gig economyWell firstly, thousands of Uber drivers are now entitled to the National Minimum or Living Wage and holiday pay as workers of the company and this means that this is likely to be a massive rush of literally thousands of Uber drivers making compensation claims.

It also means that Uber will need to drastically change the way they recruit workers. With the business now being even more liable for their workers and impacted by any resignations, screening of candidates will need to be more thorough to avoid any issues.

 

 

What does this mean to the wider Gig Economy?

This is likely to set a precedence for similar claims from workers of other organisations and that will result in a significant rethink of how their business models work.

If Gig workers are entitled to full-time employee conditions, then why not just employ them full time in the future?

 

What does this potentially mean to you and me?

If companies cannot enjoy the commercial benefits of this arrangement and are forced to employ people under normal contractual terms, then prices will go up and services may subsequently be effected.

woman holding a laptop smilingThink home food delivery, shopping, amazon, eBay, etc all these companies have adapted to the same-day/next-day delivery model, and we love it don’t we?

This decision by the Supreme Court mirrors other legal developments in this area around the world, with many other jurisdictions now considering the employment status of those in the gig economy.

 

This latest unanimous decision is likely to not only guide future decisions in the UK but also have a wider impact on policymakers and courts around the world.


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