Uber will now start treating UK drivers as actual workers, but only once they accept a trip
Holiday pay, minimum wage requirements, and more.
Last month, Uber lost a legal battle regarding drivers’ rights in the UK’s Supreme Court. Consequently, Uber announced that it would provide basic employment protection for its 70,000 UK drivers. However, the ruling doesn’t cover Uber Eats delivery workers.
Currently, the minimum wage rate is £8.72 per hour for adults aged 25 or older. But that’s going to be until this April when the minimum wage will increase to £8.91 and apply to anyone aged 23 or older.
The list of benefits available to Uber’s UK workforce includes:
- Holiday pay
- Access to a pension scheme
- Compliance with UK’s minimum wage rates
At the same time, there is discontent that drivers will get the benefits from the moment they accept a trip request. People were hoping that they would get benefits from the moment they logged on to the app. There was even a previous ruling from the lower courts saying that drivers should get coverage and benefits from the moment they logged on to the app. But the Supreme Court’s decision is final and beats any other lower court ruling. So, drivers get coverage and benefits only after accepting a trip request.
Uber’s CEO, Dara Khosrowshahi, commented on the ruling by saying that they could have disputed driver’s rights legally but that they’ve chosen “to turn the page.”
In the meantime, Uber and other companies that are part of the gig economy are facing regulatory challenges in other parts of the world as well. In the process, the company is bleeding millions of its cash.
Even in California, Uber had to push back hard against a 2019 legislation that made it difficult to classify workers as independent contractors. After spending more than $200 million, Uber and other similar companies managed to push forward a ballot measure named Proposition 22. Thanks to Proposition 22, these companies whose business models revolve around the gig economy managed to get an exemption from the state employment law. Eventually, gig workers received some benefits but not full employment status.
In light of the recent developments in the UK, Uber’s shares dropped by more than 4% on Wednesday as investors were concerned about the implications over “Uber’s operating model.” Regardless of that, the prominent people at Uber aim for “adjusted EBITDA profitability” by the end of 2021.
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