The Uber decision rested on a number of factors which highlighted the restrictions the company imposes on its drivers despite them being self-employed, including the fact that it sets the fare price, effectively dictating how much drivers are paid for the work they do. 

Uber also monitors how many trips the driver accepts and imposes penalties if too many are declined, restricts communications between drivers and passengers, and exercises “significant control” over the way in which drivers deliver their services through the use of a passenger ratings system which influences whether they can continue working for the company.

James Tamm, Director of Legal Services at Ellis Whittam, says: “The decision is certainly a costly one for Uber, but it also has potentially far-reaching consequences across the entire gig economy. Previous case law has suggested that contractual terms can be disregarded in some circumstances when considering worker/employee status and a Tribunal should look at the reality of the situation. This decision seems to go a little further, stating that it is wrong in principle to treat the written agreement as a starting point when considering statutory rights.

“Instead, the right approach is to consider the purpose of the legislation, which is to give protection to vulnerable individuals who are in a subordinate position in relation to the organisation who controls their work. The contract now arguably becomes even less important and that could make it easier for individuals to demonstrate that they are workers or employees in future cases.”