17.03.2021

UK Supreme Court Delivers Decision on Uber Driver Employment Status

The distinction between employee and independent contractor can be complex, particularly where the nature of the business model blurs the lines of standard employment practices.

Difficulty with this distinction has arisen as a result of the owner-driver business model that is typically used by rideshare and courier companies.  Uber in particular has been the subject of litigation in several jurisdictions over the status of their drivers.

In New Zealand, the Employment Court held in Arachchige v Rasier New Zealand Limited & Uber B.V that the Uber driver who brought the claim was an independent contractor, not an employee under the Employment Relations Act 2000.  Our article on this case can be found here.

Uber has now found itself in the spotlight again, this time in the United Kingdom Supreme Court.  The recent case of Uber BV v Aslam revolved around the employment status of Mr Aslam who worked as an Uber driver, where the UK Supreme Court was asked to determine whether he was a contractor or a worker.

“Worker” is a category unique to UK legislation and is a hybrid between employee and contractor.  A worker is entitled to holiday pay, sick leave and protection from unlawful discrimination as is typical for employees, but is not entitled to unfair dismissal rights or statutory redundancy pay.  We have written further about these distinctions here.

The UK Supreme Court dismissed the appeal brought by Uber, and held that Mr Aslam was a worker.  Key to its finding is that although Mr Aslam was free to choose when and where he worked, he was fundamentally working for, and under contract with Uber.  The facts pivotal to this finding were that Uber:

  • Fixes remuneration and gives drivers little discretion;
  • Restricts communication between passengers and drivers and actively prevents drivers maintaining ongoing business relationships with passengers;
  • Requires drivers to accept the contractual terms dictated by Uber; and
  • Exercises control over the driver by limiting the passenger information visible, performance managing the driver’s rate of acceptance of trip requests, vetting the type of car that is used, and by controlling the technology that is integral to the service.

What does this decision mean for New Zealand? 

Ultimately New Zealand’s courts are bound by New Zealand legislation and are to follow legal precedents set by previous decisions in New Zealand courts.  New Zealand courts will consider case law from other jurisdictions, particularly the UK, to guide analysis where the law is similar.  The Employment Relations Act 2000 does not recognise “worker” as a distinct category in the way the UK equivalent (the Employment Rights Act 1996) does.  For this reason, the ruling in Uber BV v Aslam is unlikely to disturb the Employment Court’s decision in Arachchige v Rasier New Zealand Limited & Uber B.V that deemed an Uber driver as a contractor under New Zealand legislation.

If you have any questions about contractors, employees, or the distinction between the two please contact the Employment Team or your usual contact at Hesketh Henry.

 

Disclaimer:  The information contained in this article is current at the date of publishing and is of a general nature.  It should be used as a guide only and not as a substitute for obtaining legal advice.  Specific legal advice should be sought where required.

 

 

Do you need expert legal advice?
Contact the expert team at Hesketh Henry.
Kerry
Media contact - Kerry Browne
Please contact Kerry with any media enquiries and with any questions related to marketing or sponsorships on +64 9 375 8747 or via email.

Related Articles / Insights & Opinion

Covid-19 Risk Assessment – Vaccines only part of the solution
Vaccine mandates have been the “hot topic” in the news recently.  However, it has become clear that vaccines are not a silver bullet and relying on vaccination alone to address the risk of Covid-...
01.12.2021 Posted in COVID-19 & Employment & Health & Safety
Final changes to the overseas investment regime now in force
The Overseas Investment Amendment Act 2021 came into force on 5 July 2021.
24.11.2021 Posted in Business Advice & Foreign Investment & Property
Commerce Commission study announced for building supplies market
The Commerce Commission is set to undertake a market study into residential building supplies for major components of residential buildings 
24.11.2021 Posted in Business Advice & Construction & Regulatory
‘Tis the season … to comply with the Fair Trading Act
Retailers will be seeking to make the most of in-store trading reopening, particularly in Auckland.
23.11.2021 Posted in Business Advice & Regulatory
COVID-19 Protection Framework: Vaccination Certificates and Simplified Risk Assessment on its way
For some employers, Covid-19 vaccine certificates (CVCs) are required in order to operate within the Covid-19 Protection Framework (the Traffic Light System).  The scope of this requirement is slated...
23.11.2021 Posted in Business Advice & COVID-19 & Employment & Health & Safety
Retention funds:  where is the trust?
The importance of subcontractors scrutinising how retention funds are held, and how they are dealt with by insolvency practitioners, was highlighted in the recent High Court decision in McVeigh v Decm...
Review of Anti-Money Laundering law is underway
The Ministry of Justice is carrying out a statutory review of the Anti-Money Laundering and Countering Financing of Terrorism Act 2013 (Act) to consider: how it has performed since it was introduced ...
19.11.2021 Posted in Business Advice & Regulatory
Send us an enquiry
For expert legal advice, please complete the form below or call us on (09) 375 8700.
  • This field is for validation purposes and should be left unchanged.
-->