How Uber could win in the Employment Appeal Tribunal

I spent yesterday sitting in the public gallery of the Employment Appeal Tribunal (if you can call five rows of seats the back of a big room a ‘gallery’) listening to Dinah Rose QC argue that the Employment Tribunal was wrong to find that Uber drivers were ‘workers’ for the purposes of the Working Time Regulations and the National Minimum Wage. It was a great day out!

Back in October I wrote a post headed ‘Why Uber lost’. After listening to Dinah Rose I need to talk about why Uber might win. I should be careful here. I only attended day one of the hearing. The need to earn a living means I can’t watch day two when Jason Galbraith-Marten QC will argue in favour of the drivers. It also has to be said that Dinah Rose has that quality you always want in your barrister – she just sounds like she is obviously right. She picked apart the Employment Tribunal decision in a way that made me very glad that she has never edited an article I have written. Having heard only her (very impressive) arguments, I may well have come away with a skewed idea of how strong Uber’s case is.

The argument was long and detailed, but I think it boils down to this. Minicab drivers have always been accepted as being neither employees nor workers because they do not perform work ‘for’ the minicab firm that ’employs’ them. Instead the firm is the ‘agent’ of the driver, booking work on the driver’s behalf and charging the driver a fee or commission. There was a lot of detail about the law of agent and principal which also drew on the VAT treatment of minicab firms – I don’t envy the EAT Judge (HH Judge Eady QC) the task of picking through that issue when she comes to writing her judgment. The central point, however, was that the disruptive technology used by Uber that allowed this process to be operated on a massive scale did not alter the basic facts of the relationship between the driver and Uber, which is just a glorified minicab firm.

This is a smart argument because instead of presenting Uber as a new form of business that needs a fresh approach when analysing the rights of the drivers who engage with it, it essentially says ‘look, there is nothing new here; this is a minicab firm and the status of minicab drivers is well established’. Time and time again Dinah Rose emphasised that Uber was simply operating the same tried and tested business model adopted by any old minicab company. I’m not entirely sure that Uber would want to see themselves that way, but that’s another issue.

The other main plank of the appeal was the extent to which the Employment Tribunal Judge was prepared to look behind the detailed contractual documents setting out the relationship and consider the ‘commercial reality of the situation’. In Dinah Rose’s argument this was a sloppy approach where pejorative language about clever lawyers and business jargon hid an ignorance of the law of agents and a lack of rigour in analysing the contractual obligations of the parties. This did rather strike home with me. We all enjoyed reading the Employment Tribunal decision which had some colourful language about Uber and some good literary references (I always appreciate a judge who quotes Hamlet) – but on reflection there was perhaps too much colour and not enough precision about exactly what the contractual obligations were.

There is an ongoing debate about the relevance of ‘mutuality of obligation’ when it comes to defining workers. How important is it that a worker is not obliged to accept work from the ’employer’? Under the statutory definition there must be a contract under which the worker agrees to perform work personally for the employer. However someone can be recruited as an Uber driver and choose never to turn their app on and never accept a customer – have they agreed to perform work? The Tribunal held that drivers became workers when they made themselves available for work, but Dinah Rose emphasised that even then they were not obliged to accept a booking and could turn the app off at any time. Where, then, was the contractual obligation to work?

Was the employment judge too ready to ‘step back’ from the specific contractual obligations and look at the ‘reality of the situation’? Perhaps. Even if we get past the agent and principal point (and I hope we do, it’s an area I don’t know much about)  this could become an important authority on the scope of the mutual obligations that are needed to form a worker’s contract.

We can probably expect a decision from the EAT by Christmas (I’m completely guessing here) but I’d be astonished if the case finished there. The losing side will surely take it to the Court of Appeal and I wouldn’t be surprised if a point emerged worth taking to the Supreme Court. We are far from coming to the end of this particular journey.

About Darren Newman

Employment law consultant, trainer, writer and anorak
This entry was posted in Employment status, Uncategorized and tagged , , . Bookmark the permalink.

6 Responses to How Uber could win in the Employment Appeal Tribunal

  1. Carmy says:

    I’ve skimmed your article, I’d to focus on one point the historical fact that Mini cab drivers have historically been self employed, this is correct but to my knowledge has never been challenged, until now.
    Uber also claim that their drivers are free to work for more than one company, I challenge uber to produce 100 drivers that work for other companies as well as Uber.

  2. Darren, many thanks. Did Dinah deal with the decision of the ET on 25th September in the Addison Lee case where again the drivers were held to be workers? One of the possible ironies of this case is that being nosy I always ask the Uber drivers I use if they are concerned to receive holiday pay and most don’t give a monkeys and about half do other jobs. But before I am told off I concede this is not exactly empirical research!.

    • Hi Stephen. Indeed she did. She handed up the ET decision and spent some time pointing out all the ways in which AL drivers are more controlled and have less freedom than Uber drivers. Clear suggestion was that the ET case on AL was fine – but had no bearing on Uber.

  3. Pingback: #UberAppeal: app argues its drivers aren’t ‘workers’ in latest gig economy legal battle – Law, mostly.

  4. Tom says:

    Addison Lee drivers were ruled not to be self employed.
    https://www.leighday.co.uk/News/News-2017/September-2017/Victory-for-Addison-Lee-drivers-as-Tribunal-finds

    Let’s hope Uber loses this appeal too. Their drivers are currently making around five pounds an hour on average, after expenses.

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