On Friday, the U.K.’s Supreme Court ruled that Uber drivers should be classified as workers who are entitled to legal rights and protections.
Uber has long advocated for its workers to retain their classification as independent contractors, arguing that drivers have flexibility and therefore should not technically be considered employees. However, in his ruling, judge George Leggat concluded that Uber workers who log into the Uber app effectively enter a contract with the company to “perform driving services for Uber London.”
“The employment tribunal was right to find that Uber drivers are workers who therefore qualify for the rights conferred on workers by employment legislation,” said Leggatt, reading a summary of the ruling on a court livestream.
The judges said that although drivers can choose their own hours, Uber runs its business in a way that results in drivers being “very tightly defined and controlled” by the ride-hailing firm. For example, Uber controls drivers by keeping track of their ratings and ensuring that their communications with passengers are kept to a minimum.
“Drivers are in a position of subordination and dependency to Uber," the court said, adding that the only way they can boost their earnings is by “working longer hours while constantly meeting Uber's measures of performance.”
Uber said it respected the court’s ruling that it acts as an employer, but it pointed out that it focused only on a small portion of drivers who used the Uber app in 2016.
“Since then we have made some significant changes to our business, guided by drivers every step of the way,” Jamie Heywood, Uber’s Regional General Manager for Northern and Eastern Europe, said in a statement. “These include giving even more control over how they earn and providing new protections like free insurance in case of sickness or injury.”
The case will now return to the Employment Tribunal, where officials will decide how much compensation drivers are owed.
Uber has historically pushed back against challenges to its classification of drivers. When a similar judgment was made in California, it ended up shelling out around $220 million in advertising to push through Proposition 22. Ultimately, Prop 22 rolled back the court ruling and an earlier California law called AB 5, which offered more protections to drivers.