Uber will grant its 70,000 British drivers employee status in what is a world first for the car with driver app. Drivers will be entitled, inter alia, to the minimum wage and pension. Uber’s decision follows the UK Supreme Court verdict which ruled that Uber drivers on the island should be considered employees, not ‘self-employed’
What changes
Uber drivers will receive at least the national minimum wage of 8.72 pounds per hour starting tomorrow 17 March. This will be the least that drivers can earn, in what Uber has described as a “revenue plan, not a revenue cap.”
Uber did not specify how much the reclassification will cost, but said it does not expect to change its earnings forecast for the quarter or year.
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The changes are limited to the UK, Uber’s largest European market, but raise questions as to whether the company is willing to consider adapting its business model in other countries.
The San Francisco-based company faces legal challenges in its home state of California, as well as pressure from European politicians to improve conditions for gig-economy workers.
“This is an important day for drivers in the UK,” said Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe. “Uber drivers will receive an earnings guarantee, holiday payments and a pension, and will retain the flexibility they currently appreciate.”
The ruling of the Supreme Court
In a ruling last month, the UK Supreme Court unanimously dismissed Uber’s arguments that the drivers were not employees, giving the company little choice but to offer more benefits.