The 'Gig Economy' - Uber Tribunal

welcome to this webinar on employment status in the gig economy. This is part three off a wider Siris of Webinars. On this topic on, we're going to be looking at the Uber tribunal case in this Webinar. My name is Ben. Um, Anwar, it's nice to meet you. I'm a barrister at 36 group. It's the chambers in London and I practice in public and commercial law. What are we going to be doing in this webinar? Well, first of all, I'm going to be talking you through one off the key cases in the gig economy case law that seems to be expanding by the day. The Uber Tribunal case, although it was only heard in the employment tribunal on so it doesn't create any binding precedent, is nevertheless something off a watershed moment in terms of the regulation off the gig economy. So we're going to be looking at what are the key factual and legal issues in that case. But I'm gonna leave it there will also look at the implications for both lawyers, employers and also for people who want to be workers or actual workers in the workforce. So some practical tips emerging from the result of this major tribunal case. So to introduce this case, what was it about? Well, uber has approximately 40,000 drivers in London alone, of course, is operating cross other cities nationwide? The case couldn't really be off greater importance, given the large number of people affected by it, but also the fact that this is one of the first employment tribunal litigations to engage with the relatively new economy off online platforms that depend upon flexible workforces. So it's a major case. What is it about? Well, a handful off uber drivers, Mr As Lamb, Mr Farah and others came to the employment tribunal to claim for paid annual leave and to claim for the national minimum minimum wage. There was also a protection from whistleblowing claim added in as well. Uber's response, as often happens in cases like this, was to deny that these drivers were workers, and so to cut them off at the first hurdle, the employment tribunal therefore held a hearing to determine whether or not Uber's drivers were workings. Now we've been through already, in part one off this Webinar series, the relevance employment legislation, but just to recap, because it's always worth reminding yourself off the wording of the statute. That's something that judges are very keen to emphasize. You've got to go back to the statute. A worker under Section 2 30 subsection three off the Employment Rights Act of 1996 as replicated in the working time regulations. Nights eight on the National Minimum Wage Act 98 as well reads as follows. So worker means an individual was entered into or works under brackets or where the employment has ceased worked under close brackets. Any other contracts. And this is substance subsection B. Any other contract, whether express or implied? Andi, if it is expressed, whether Orel or in writing, whereby the individual on the takes to do or perform personally any work or services for another party to the contract whose status is not by virtue off the contract that's with a client or customer off any professional business undertaking carried on by the individual? It is one hell of a mouthful, but the courts generally break this down into two component parts. The first part is the requirement for a contract of personal service, and so a contract, which has to be performed by the individual worker, not just anyone else. The second part of this definition relates to the importance that the legislation places upon the relationship not being one off to independent businesses. So if the relationship is actually between a one person business, who is servicing the needs of the client rather than the relationship off a worker who servicing the needs of an employer, then a worker status will be established. So two parts personal service. Andi the importance off not running a business in your own right on DSO. The Uber case, then, is one example where the company went to great lengths to define the relationship between itself and its drivers. But to characterize that relationship as not being one that would give rise the basic employment rights. The contracts essentially were drawn in such a way that it described uber as providing a service to the drivers rather than the other way around, and the company was effectively an intermediary. So there were two contracts that the tribunal was looking at. Number one is the contract between uber Andi, its customers so uber and the riders, and in that contracting described itself as not providing transport services which you know taking a step back from all of this might seem somewhat extraordinary, given the public perception off over so it didn't provide any transport services. It's not a transport company according to its own contracts with It's Riders, the other contracts between Uber and its drivers and in this contract effectively, it stated that its job was to provide the technology platform for the drivers to access their customers of the riders. That's all that uber does, and it doesn't control the drivers in any way doesn't require them to provide the driving in a particular manner or indeed, obliged them to use the uber app to be logged on and to be driving for uber for a particular length of time or at a particular frequency. So it really allow the drivers freedom to determine when, where, how they work and how often, according to their own preferences. And not according to uber's now presenting this contractual framework to the employment tribunal. Uber was essentially arguing that there's no contract for personal services between uber and its drivers. You recall the first limb off that definition in Section 2 30 subsection three b in the employee Rights Act has replicated other legislation is that there must be a contract personal contract for services so obliging the driver or the drivers to perform at services for uber and whoever said that was not present. So what did the tribunal make of all this? Well, first of all, let's look at what factors the tribunal considered to be the relevant factors it needed to look at. There's quite a wide range because effectively, when determining worker status on employment tribunals judge employment judges role. Sorry is to look at all the relevant circumstances on the relevant circumstances could include. But it's certainly not limited to, for instance, the degree of control exercised in practice buying the company over the worker off the operative. Also relevant is this idea of subordination. To what extent does the contract and also the reality? The economic reality around the contract show that the claims worker is subordinate is in a much lower position to the company that they are working for. Of course, none of these factors are determinative, so the employment judge has to look at a lot these factors in the round and come to a conclusion on the evidence before it. Also relevant is Thies this notion of exclusivity. So does the contract require the driver or the plumber? Whoever happens to be toe work? Only four that company, or does the reality of the relationships amount to? That doesn't amount to the same thing. So even if something isn't written into the contract, does it actually work like that in practice? Does the company have a monopoly effectively over that workforce? The duration off the engagements? Maybe relevant. So, for how long does this contract will this arrangement of work oblige the worker toe work for this company? Is it indefinite, or is it time limited? And if it's time limited, how long for the method of payment? How did the workers get paid? This is highly relevant in some previous case law where, for instance, the customer to the third party is the actual person who pays the worker rather than the company itself. That may be a factor tending to show that the individual is not a worker because they're actually contracting with customers and not contracting directly with the company. Apply off equipment. That is another factor. Where do the tools of the trade come from Whose are they? Are they loaned on they purchased directly by the worker or the individual claiming to be a worker or they provided by the company? Thes sorts of factors will always almost always be relevant, and it's linked to the next one, which is who bears the economic risk. If all goes wrong in thesis services that are being provided, who loses out who has to pay for it? On what are the reasons behind that? Moving on the fact that a an individual claiming to be a worker markets themselves as an independent contractor or a freelancer may also be highly relevant. Likewise, the absence or active marketing in this regard is also relevant on will tend to show that the person is a worker, and then the tribunal overall is going to be looking at whether or not this arrangement resembles a relationship between two independent businesses with all of the issues of equality of bargaining power that that implies, or does it actually reflect something more akin to an employment relationship or a worker employer relationship with all the subordination that that implies one of the tools in the employment judges? Toolbox is the case off auto Cleanse and Belcher. That's a 2011 case, and it relates to circumstances in which judges should look outside off the black letter off the contract. Now it seems that in most of these gig economy employment tribunal cases, this is exactly the approach that judges have taken. They've listen to what the company has said about its various contractual documents. It's looked at those documents carefully. But it's also heard evidence from the workers heard evidence from the company and come to a conclusion on the overall circumstances. Now, it's not only when a judge thinks that the contract is actually a sham or is a complete and utter ruse that judges are allowed to do this. The importance off doing this is that it gets to the reality of the arrangement, and the judges task is to find Walt is the true agreement between the parties that will involve examining all of the evidence. It's also recognized, and this is a factor that the tribunal picked up on in the UBA case that armies of lawyers right, these types off contractual documents on armies of lawyers aren't always to be trusted when it comes to assessing if the contract actually reflects the reality off the working engagement, so so that slightly more political or policy based consideration is something that the tribunal is very much alive to. And it took a very skeptical approach to Uber's arguments in this case. Is will go on to next. What did the Triangle Tribunal conclude about worker status off goobers drivers? The tribunal found that his drivers were workers. It found that provided three conditions were met, they would satisfy the definition of workers. And those three conditions are number one. The drivers have the uber app switched on number two that they are within the territory that they are authorized to work in. So, for instance, uber has London drivers. You can only drive in London. Manchester drivers. You can only drive in Manchester, so they've got to be in that territory. And thirdly, that they are willing and able to accept jobs it would say to accept driving jobs. Now, how did the tribunal arrive at this conclusion? Well, first of all, the tribunal noted throughout its decision that although the contracts might be saying that these drivers are not workers and these drivers are self employed in other areas of uber's marketing, and it's a written literature and online Uber was actually singing a different tune. It was suggesting, on acknowledging that these drivers were employed, that these drivers were part of its workforce on integrative within it. And so the tribunal preferred those rather less guarded comments over the contract terms. It found that uber's denial or the fact that it provided transportation services was simply not credible. It also found that the contracts that uber had crafted between it and the drivers were simply not a reflection off the reality. The reality waas that these drivers were not individuals plying their own trade. They were not doing business in their own right or trying to grow their own independent businesses. They were integral parts or uber's workforce, and therefore they were under a personal obligation to work for uber. There couldn't be a contract, an enforceable contract between the drivers on the riders, And that's because the drivers and riders they don't actually know who each other are. That's because the uber app does not share that data with either the rider or the driver, and so it would be practically impossible or very difficult for the drivers to seek to enforce a contract against their customers. The tribunal also concluded that for a whole range of reasons, uber exercised a certain degree of control, off supervision, off guidance and management over its drivers. That all suggested that they were in a relationship off employer on work. And so, for instance, who will manage the booking off each each job? It's set the fair. Although a driver could negotiate the fair downwards, it couldn't negotiate the Fed upwards and again, if you think about that, that seems inconsistent with being a self employed free lance, are able to set your own level off profit. It also had a program of recruitment so it would advertise for drivers it would get them in, put them through a training video and training materials on sign them up through a recruitment process that again does no accord with being a dealing with self employed individual businesses. You but sets the roots if you've ever taken a new, but you'll know that they're using GPS system that instructs them which way to go that is a system operated by uber. It's not operated by the driver on the driver may be penalized for deviating from the particular a satnav route that uber gives to the driver. The tribunal also noted that in terms of independent marketing, well, the drivers weren't marketing themselves to the world. They were only effectively working for uber some of the case law that uber relied upon to suggest that actually the drivers were self employed independent contractors and not workers was simply no relevant because it related to situations where persons would provide services that were ancillary to the main business that was being operated. And so, for instance, in the case of Quashie on String Fellows, which was case involving a lap dancer who was found not to be an employee, that was one of the reasons for that was because she was providing services that weren't the main service off the String fellows restaurant chain, apparently according to that case. But the fact is that the drivers in uber to simply aren't comparable because uber provides transport. The drivers are fundamental to that. The only way of seeing it is that they are an integrated part off uber's operations. So for a very wide range of reasons, uber lost its tribunal claim. It went on to appeal to the employment Appeal tribunal on in the next webinar in this Siri's I will be telling you what I saw when I sat in the Employment Appeal tribunal, observing who was very recent appeal of a reason at the time of recording this webinar just three pointers to finish off home in the little time that we've got left. This was effectively a fact sensitive dispute, so it's difficult to extract one or two legal principles from it. But I think one thing that really bears out from this decision is that the tribunal is simply not going to allow particularly large employers to evade or avoid basic employment rights through the clever drafting off employment contracts or contracts for particular services. Where the contract simply doesn't marry up with the reality where individuals are not genuinely self employed and where effectively the tribunal has got to balance the case between a large business Andi small time individuals who have very little protection, very little employment security. It is going to take a skeptical approach to well lawyered and well crafted documents that simply don't accord with reality, and ultimately that would seem to be fair play on the employment tribunals part. Thank you very much for listening. I hope this has been interesting for you. I'm really interested in this topic. And I look forward to talking to you more about both the uber appeal on the gig economy Case law as it unfolds across this Siri's off Webinars. I'm Veneman. Well, thanks for listening.