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Current Affairs

UK ruling on Uber drivers

Date: 23 February 2021 Tags: Judiciary & Judgments

Issue

The UK Supreme Court Friday ruled that Uber drivers were to be considered workers and not freelance contractors.

 

Background

This makes them eligible for all employment related benefits such as minimum wage, annual leaves, and insurance.

 

Details

  • Uber and other service providing platforms could also potentially face legal and regulatory challenges in India.

  • The UK Supreme Court was adjudicating an appeal by Uber against a ruling by an employment tribunal of the country.

  • The tribunal had held that Uber drivers were entitled to all benefits of regularised workers and that they would be considered on duty even if they were logged into the app, and not just when they were driving their passengers to their destination.

  • Uber said it solely acted as a platform which connected willing drivers and service seeking passengers, and that the contract as such was made between them.

  • The UK Supreme Court turned down this plea and that the lack of a legal agreement as such between Uber and the drivers on its platform would not be an impediment in its being considered an employer.

 

Conditions for the decision

  • The court considered five main aspects to rule against Uber’s contentions. The first was fixing of a certain maximum fare by Uber, which has to be accepted both by the driver as well as the customer.

  • Since the drivers could not possibly charge a fare higher than what was mandated by Uber, it therefore meant that the app was dictating how much the driver could earn.

  • Secondly, the terms of the service are imposed by Uber on the drivers and the drivers have no say in changing or challenging that, which is akin to workers under permanent contracts.

  • The third aspect that the court considered was that once the driver partner had logged into the app, they had very little say in accepting or denying rides, and that Uber controlled this by monitoring their acceptance and declining rates.

  • The fourth aspect was the rating systems offered to the passengers, which also influenced the drivers’ delivery of services and the quality of ride they get.

  • The fifth aspect considered by the court was Uber actively discouraging any form of communication between the driver and the passengers, thereby acting as the intermediary in between.

 

Implications of judgement on India

  • The central government has increased its focus on the differential treatment of workers associated with such big tech platform in India compared to other countries of the world.

  • The variation in terms of service offered by these platforms has also been under scrutiny by the central government. 

  • The budget for the 2021-22 has already mandated that the law on minimum wages would now apply to workers of all categories including those associated with platforms such as Uber.

  • Driver partners of Uber and Ola have also mounted legal challenges against the two companies. They claimed that the drivers registered with both these platforms were being denied even the basic benefits such as compensation in case of accidents or deaths.