United Kingdom: Uber business model in London judged unlawful

The High Court has rejected a case brought by Uber regarding the legality of its business model in London. The US ride hailing giant brought the case after the Supreme Court ruled in February that Uber drivers are “workers”, as opposed to self-employed people, and are therefore eligible for certain rights (see article n°12369). Despite this decision, Uber continued to regard itself in London simply as an agent in charge of bookings and not customers. This stance has been tolerated by Transport for London (TfL), the government body responsible for the UK capital’s transport network. The High Court has however decided that this model, which is commonplace in the gig economy, is not lawful, saying: “To operate lawfully, an operator must undertake a contractual obligation to passengers.” This means that the platforms are responsible for the service offered, not the drivers, and may be required to pay value added tax (VAT). James Farrar, general secretary of the App Drivers and Couriers Union (ADCU), says: “Our victory will now make misclassification unlawful, transform the London minicab industry for the better and finally eradicate sector wide worker rights abuses.” According to press reports, over 1,800 licensed operators in London will have to review their model following this decision, which Uber accepted without complaint and described as “clear”.