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Gig Economy - Supreme Court rules Uber drivers are workers not self-employed (Updated)

Graham Watson

21st February 2021

Big news in the gig economy as the UK Supreme Court has decided that Uber drivers are not self-employed contractors but employees.

This landmark ruling means that they are entitled to a variety of workers' rights.

Uber claims that its employment model has changed and that the ruling only applies to a few drivers but others believe that it's likely to face a hefty compensation bill. It will be interesting to see how this pans out - but the ruling strikes me as self-evident, to be frank.

If a taxi driver was previously working for a small minicab firm, but then decides to drive for Uber has his job changed? So on what basis could Uber decree that his conditions of employment have changed.

Other such cases are being pursued, although California voted on this in December - alongside the Presidential ballot - and ruled that drivers were self-employed, although US labour protections are generally weaker than those in Europe.

This is a hugely important story focusing as it does on employment rights in the Gig Economy. We will see a new architecture for the responsibilities of employers such as Uber, Deliveroo and many others as we emerge from the pandemic?

Some of there reaction to the UK Supreme Court ruling is summarised in the embedded tweets below.

Uber has lost its Supreme Court appeal against an employment tribunal ruling which said its drivers were workers and therefore entitled to workers' rights rather than being classed as independent contractors

This Guardian piece looks at how the Conservative government has largely overlooked employee rights over the recent past and this has allowed the gig economy to emerge and pay little heed to workers' rights.

It's a lovely example of how the private sector has first-mover, and resource advantages in lots of sectors of industry - with big tech companies innovating, declaring that their lawyers find something OK and then getting on with it before the government is able to regulate it.

However, it's a difficult balance between fostering innovation and protecting workers.

Here is a recent tutor2u video looking at some of the economics of the Gig Economy

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to Tutor2U, reads voraciously and is interested in all aspects of Teaching and Learning.

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