6 months ago by Lauren Fonseca

Is This the End of Self Employment?

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For two years now, taxi giant Uber have been faced with a battle in the UK courts over the rights of its drivers. Described as a landmark case, the outcome could impact millions of British workers in the gig economy.

Uber have argued that its 70,000 drivers are self-employed and not workers, meaning that they have no entitlement to basic workers’ rights such as holiday pay. On the day of the third court case, in October 2018. Hundreds of “precarious workers” in gig economy jobs staged a march through London and Glasgow in protest of Uber and the many large companies like it using the gig economy model to grow.

Uber aren’t the only company facing legal struggles – An enquiry was launched into working conditions and pay at Deliveroo, the online takeaway service that resulted in a group of 50 Deliveroo couriers won a six-figure settlement in June 2018. Also in June, courier service Hermes lost a court case, with a ruling passing that a group of 65 couriers should be treated as drivers.

In June, plumbing firm Pimlico Plumbers also lost a similar case, which ruled that its workers were entitled to basic workers’ rights in the UK Supreme Court, the highest court in UK law. Uber’s court case in October is with the Court of Appeal – if they fail, they too will be forced to take their case to the Supreme Court for a ruling.

Do these companies stand any chance? The employment judge in the Uber tribunal famously said of the issue: “The notion that Uber in London is a mosaic of 30,000 small businesses linked by a common ‘platform’ is, to our minds, faintly ridiculous.” Could it be true that the end of the gig economy is in sight?

In California USA, drivers for cannabis companies have been legally required to be classified as employees rather than independent contractors from the beginning of the year, providing a real-life working example of what the alternative is to the gig economy structure. Worker responses have reportedly been mixed – some appreciate the job security, while others have issues with the far more regimented shift structure and loss of freedom.

Having employees requires a large upfront cost from businesses in the name of training, employee meetings, performance monitoring and potentially other rewards such as employee benefits. Wanting to avoid these overhead costs, it’s no surprise that UK firms are fighting court rulings as much as possible.

This may explain why, even with significant worker victories in court cases this year, most companies have yet to implement any significant changes to their structure. Uber has thus far lost two court hearings on their case – the first in October 2016. At time of writing, Uber have yet to adjust their contracts in line with this ruling to make allowances for National Minimum Wage and holiday pay for its drivers.