British Uber drivers are entitled to minimum wage and holiday pay, tribunal rules
It's a ruling that will have huge implications for the company's 40,000 UK drivers, and may also have significant knock-on effects across the broader "gig economy."
Uber has always maintained that drivers who use its platform are independent contractors. It frames itself as nothing but a technology platform, connecting riders and drivers and taking a fee in the process.But its critics argue that it is actually more akin to a traditional taxi company, and has a responsibility towards its drivers.
The case was brought against Uber by the GMB union on behalf of Uber drivers, which argues that drivers on the platform should be entitled to the minimum wage and paid holiday, and that Uber is breaking the law by failing to provide this.
The case may have broader implications for the "gig economy" - a fast-growing industry of on-demand services like transportation, food, and cleaning, often accessible via mobile apps. Its advocates argue it provides convenience for users and flexibility to workers, but detractors argue that it strips away employment rights for workers, who are often independent contractors.
The Social Market Foundation estimates that nearly 60% of self-employed people working in transport and storage industries earn less than the minimum wage.
Ahead of Uber/GMB ruling due out soon, we estimate that almost 60% of self-employed in transport+storage earn less than National Living Wage pic.twitter.com/EDVcrTdCJ0- Nida Broughton (@FiveMinuteEcon) October 18, 2016
Nigel Mackay, from law firm Leigh Day (which represented the drivers in the case) said in a statement: "This judgment acknowledges the central contribution that Uber's drivers have made to Uber's success by confirming that its drivers are not self-employed but that they work for Uber as part of the company's business."Uber drivers often work very long hours just to earn enough to cover their basic living costs. It is the work carried out by these drivers that has allowed Uber to become the multi-billion-dollar global corporation it is."
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