In a major victory for unions, Uber Technologies Inc’s more than 70,000 British drivers are to be paid the minimum wage while picking up and driving passengers as part of the ride-hailing company’s agreement to grant workers’ rights after it lost a groundbreaking British Supreme Court case last month.
Uber has pushed back against European and US labor advocates’ demands for better driver compensation with some success, calling for a “third way” of combining flexible on-demand work with more limited benefits than traditional employees receive.
The agreement in the UK classifies Uber drivers as workers who are entitled to fewer rights than those classed as employees, who are also guaranteed sick pay and parental leave.
Photo: Reuters
Uber in California last year pushed and won a similar compromise.
In a case led by two former Uber drivers, a UK employment tribunal ruled in 2016 that they were due entitlements such as paid holidays, prompting Uber to appeal all the way to Britain’s top court, which ruled against it last month.
Uber at the time said that it would consult with drivers, while lawyers said that it could take several months for the details of the ruling to be worked out at a further employment tribunal hearing. Meanwhile, more cases could be filed.
On Tuesday, Uber said that UK drivers would receive some added benefits, including paid holiday time, be enrolled in a pension scheme and receive no less than the minimum wage, which stands at an hourly ￡8.72 (US$12.13) for those aged 25 and older, after they accept a trip request.
Drivers would not receive minimum wage during the time they spend waiting for a passenger. That portion, known as cruising or dead-heading, can account for as much as one-third of the time drivers spend behind the wheel with the app turned on, several US studies have found.
UK and US labor activists have called on Uber to pay drivers from the moment they log onto the app and are available, but Uber has said that it cannot control what drivers do during that time and whether they were actually working.
The Silicon Valley-based firm said that its drivers in London, by far its largest market in Europe, earn ￡17 an hour on average and the flexibility to choose if, when and where they work would be retained.
France’s top court last year recognized the right of an Uber driver to be considered an employee, while EU regulators are considering new rules to protect gig economy workers.
California lawmakers last year implemented a bill that would have forced gig economy companies to treat their workers as employees, leading Uber to put forth its “third way” ballot proposition, which voters approved.
That cemented app-based workers’ status as independent contractors while offering some benefits, including minimum pay while riders are in their vehicles, healthcare subsidies and accident insurance.
In California, Uber has financed at least some of the added benefits by increasing prices for riders.
Tuesday’s announcement could affect others in the gig economy, where millions of people tend to work for one or more companies on a job-by-job basis.
“Uber is just one part of a larger private-hire industry, so we hope that all other operators will join us in improving the quality of work for these important workers who are an essential part of our everyday lives,” Uber regional general manager for northern and eastern Europe Jamie Heywood said.
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