The app-based private taxi company Uber is facing a fundamental challenge to its business model in the wake of a High Court judgement that will affect all private hire operators in London, and potentially throughout the UK.
In February, the Supreme Court had made a ruling that Uber’s drivers should be classified as workers with access to the minimum wage and paid holidays. In a High Court case brought by the company to seek clarification, Uber had claimed that its role was that of ‘booking agent.’ However, on Monday the 6th of December, the court found that Uber, not the driver, had a “contractual obligation with the passenger to provide the journey in respect of that booking.”
A spokesperson for Uber said: “Every private hire operator in London will be impacted by this decision, and should comply with the Supreme Court verdict in full…We’re not the only player in town. Other operators must also ensure drivers are treated fairly.”, whilst Transport for London (TfL) issued a statement saying:
“All operators will need to carefully consider the court’s judgment and take steps to ensure that they comply with it, including considering whether any changes to their way of working are required,”
This judgement is likely to have far reaching implications. Even though this ruling applies currently only to the capital, both Uber and union officials expect the judgement to have wider ramifications. The GMB’s Mick Rix said:
“GMB urges private hire operators such as Bolt and Addison Lee — who still refuse to give drivers the rights to which they are legally entitled — to change their business models in light of this judgment.”
James Farrar, General Secretary of the App Drivers & Couriers Union (ADCU), said:
“Rather than fix its broken business model, Uber was determined to double down on misclassification at the cost of worker rights, passenger safety and the avoidance of VAT. Our victory will now make misclassification unlawful, transform the London minicab industry for the better and finally eradicate sector wide worker rights abuses.”