Uber commits to living wage, holiday pay and pension benefits
Following the recent Supreme Court Judgment in Uber and others v Aslam and others, Uber has announced that it will begin to pay its drivers the National Living Wage, pension contributions, holiday pay and other statutory payments to which ‘workers’ are entitled under UK employment law.
The Claimants’ representatives have cautiously welcomed the move by Uber but have said that the change in direction does not go far enough.
Originally, Uber indicated its view that the only part of its workforce whose terms and conditions would need to be changed in light of the Judgment were the drivers who had brought the initial claim.
This position became untenable following weeks of criticism and, on 17 March 2021, Uber committed to paying drivers the National Living Wage during their driving time. This will ensure a minimum payment for the drivers with the opportunity to earn more through their fares.
However, as the National Living Wage will only be paid during the workers’ driving time, the announcement by Uber does not fully comply with the Supreme Court Judgment, which stated that working time should start when a driver logs on. This means that the waiting time in-between drop-offs and pickups will remain unpaid. Uber has also failed to clarify whether it will pay any back pay to its drivers.
The question now is what impact this will have on the rest of the gig economy. Many companies will be in the process of reviewing their relationships with supposedly self-employed contractors and looking at ways to either: implement the recommendations within the Judgment (i.e. enhance the benefits to which their workforce is entitled); or attempt to alter their business model in order to circumvent the Judgment.
Whilst the Judgment is likely to have a significant impact on the gig economy, each employment status case will be determined on its specific facts. Therefore, it is likely that the claim against Uber will not be the last of its kind.
One thing is for certain: as Uber’s costs increase (consequent to the changes the Judgment has encouraged it to introduce) it will have to find ways to fund them.
These additional costs will likely be passed to the end consumer. We must wait to see what impact this, alongside the other implications of the Judgment, will have not only on Uber but on other organisations within the gig economy as a whole.