The ramifications for Uber, Lyft, and other on-demand services in the U.S. remain to be discovered, but Uber’s U.K. drivers are no longer considered self-employed contractors after a court ruling in London on Friday, according to CNNMoney. Uber has already said it would appeal.
If the ruling holds, the new classification entitles U.K. Uber drivers to the country’s minimum wage, paid time off, and possibly even back pay, according to employment attorney Ed Marchant from IBB solicitors.
The legal director of the GMB labor union that represented the drivers in court, Maria Ludkin, said, “This is a monumental victory that will have a hugely positive impact on over 30,000 drivers in London and across England and Wales and for thousands more in other industries where bogus self-employment is rife.”
Marchant said this ruling could apply to other on-demand services in the U.K. and that the companies involved might be forced to change their businesses. “From Uber’s perspective the substantial additional cost resulting from the judgment means that they are likely to significantly change their business model and/or pass these extra costs onto customers,” he said.
From Uber’s perspective, the ruling doesn’t serve the drivers. “Tens of thousands of people in London drive with Uber precisely because they want to be self-employed and their own boss. The overwhelming majority of drivers who use the Uber app want to keep the freedom and flexibility of being able to drive when and where they want,” said U.K. Uber head Jo Bertram.
Uber and Lyft are both faced with class action lawsuits in the U.S. over driver status. Uber had offered a $100 million settlement, but that amount was questioned by a federal judge who first wanted more information, and then eventually rejected the proposed settlement in August.
The lawsuit is still pending but has not yet gone to court. English law is not U.S. law, but U.S. laws were originally based on English law so all parties involved will likely be watching the results of Friday’s ruling.
- NYC mandates minimum wage for Uber, Lyft, other app-based rideshare drivers
- Uber agrees to pay $148 million for 2016 hack and cover-up
- Flying food: Uber has set a target date to use drones for meal delivery
- Uber is about to restart self-driving car tests but on a reduced scale
- Here’s how Uber plans to improve its service for riders in wheelchairs