Workers take fight against ‘gig economy’ disrupters to court

Cases against Uber and Deliveroo expose vulnerability of on-demand labour force

It’s called the gig economy by some, and Victorian-era exploitation of vulnerable workers by others.

Driving a car for Uber is “work that puts you first”, according to, well, Uber. “Turn your bike into a moneymaker”, suggests Deliveroo. The two companies, hailed as tech industry “disrupters”, have much in common. Neither regards their drivers or cyclists as employees. And both are fighting separate, but similar, legal battles in the UK to stop them from being defined as such.

On Tuesday, Uber campaigner and driver James Farrar will be among those rolling through Holborn, passing the employment tribunal building where a case relating to Deliveroo is due to be heard, and then proceeding to traditional protest site Parliament Square.

Farrar, an Irishman with a software background, was one of the two test claimants in a significant recent legal victory for Uber drivers in London. It was reported as having the potential to “deliver a blow to the gig economy”, or to put it another way, help slow down the spread of precarious employment practices.

The tribunal ruled that Uber should treat its drivers as employees, meaning they should be entitled to the minimum wage, sick pay, holiday pay and other rights. Uber is appealing.

The tribunal was blunt in its criticism of Uber, the "everyone's private driver" company founded in San Francisco in 2009 by entrepreneur Travis Kalanick. In his reasoning, the judge said Uber merited "a degree of scepticism" for "resorting in its documentation to fictions, twisted language and even brand new terminology". He deemed the evidence of Jo Bertram, who oversees Uber's operations in Northern Europe, to be "grimly loyal".

Critically, the basic premise of the drivers’ case – that Uber instructs, manages and controls the drivers, and therefore they are hardly self-employed – was accepted, and the claim that Uber in London was “a mosaic of 30,000 small businesses” was rejected.

The drivers cannot set their own fares, nor are they permitted to directly contact passengers, or “riders” in Uber-speak. They may be forcibly logged off the app for a short period if they decline three trips in a row, and they may have their “fees” reduced if Uber agrees a partial refund with the passenger.

The judge concluded it was “not real” to suggest Uber was working for the drivers. “The only sensible interpretation is that the relationship is the other way around.”

‘Emphatic and scathing’

Farrar didn’t expect the judge in his case would be so unequivocal in his language. “That was the surprising bit, that he was so emphatic and scathing.”

Originally from Enniscorthy, Co Wexford, Farrar is the founder of a non-profit group called Networked Rights which advocates for “fairness in the sharing economy” and investigates abuses. Although he needed to supplement his income when he joined Uber in 2015, he is a campaigner first, and Uber driver second. “I really had to go on the inside of it to see how it all worked,” he says.

He was surprised by how “brutal” the conditions were – the number of hours it was necessary to stay logged on in order to make a living, and the sense that if something went wrong, he was on his own. He approached law firm Leigh Day for advice and the GMB union – the UK’s general trade union – later backed a case.

The details contained in the tribunal documents underline just how powerless workers in this app economy really are. When Uber issued revised terms to its London drivers in October 2015, for example, there was no consultation or discussion – the new terms simply popped up on its app. Drivers had to accept them before they could log in and pick up passengers. No agreement, no income.

In the on-demand economy, feedback is instant. In a system satirised by the dystopian television drama Black Mirror, passengers are asked to rate their driver on a 0-5 scale. Drivers with average scores below 4.4 are asked to improve them – if they do not, they may eventually be removed from the platform and their accounts deactivated.

“Gigging” for app-based services is portrayed as a way for people to “supplement” their income – their primary source of earnings falling short of the cost of living. The literature presents it as a kind of convenient bonus. But this characterisation of the worker as someone who fancies making a bit extra on the side is in dispute.

In the case of Uber drivers in London, Networked Rights found that the median hours worked by Uber drivers was 45 a week, for which the median earnings worked out as £6 per hour, below both the UK’s statutory minimum wage of £7.20 per hour and the opt-in London Living Wage of £9.75 per hour. By not being treated as employers, Uber drivers lose out.

Compared to the well-represented black cab trade and the "big money operators", Uber drivers are poor and vulnerable, Farrar says. A cap on private hire licences would help protect them, but Uber lobbied against a cap when it was floated by former London mayor Boris Johnson.

Congested city

Farrer is yet to see any evidence that new Labour mayor Sadiq Khan will tackle the problem, but he believes a case can be made for a cap on licences purely on safety and air pollution grounds. Uber is competing directly against mass transit bus and underground services in an increasingly congested city. "That is not sensible."

He is not without optimism. British prime minister Theresa May has said she wants to be "certain that employment regulation and practices are keeping pace with the changing world of work" and has ordered an examination of how the rights of gig economy workers might be extended.

“If Uber are not very careful, they will end up losing the battle and the war,” says Farrar.

Earlier this month, Farrar sent through a request to “Jo and team” for a paid holiday – to underline the point that employees are entitled to them under the law. Uber sent back a note saying that he could keep the app turned off if he liked, but, as it was appealing the ruling, “until a final decision is reached we will not be intending to pay any holiday pay”.

In Ireland, Uber does have employees. More than 200 people work at its Centre of Excellence call centre in Limerick, and this number is set to rise further. The offices, run by Uber Ireland general manager Kieran Harte, opened in January, with assistance from IDA Ireland.

There was a suggestion that the city of Limerick would play host to a pilot ride-sharing service. This appears to have fallen by the wayside, following government resistance. “We don’t have any update with regards to a ridesharing pilot at this stage,” a spokesman said.

Ambitions in Ireland

For now, it doesn’t quite have the same army of “self-employed” drivers and ride-sharing services here as it does elsewhere. Uber’s ambitions in Ireland have been constrained by Government policy. It can only provide bookings to licensed drivers using licensed taxi or limousine services, not unlike Hailo.

Minister for Transport Shane Ross has been strongly advised by his officials not to allow Uber to disrupt or skirt existing taxi regulations and introduce ride-sharing using "ordinary" drivers. And Ireland is hardly the only Uber-refusenik: internationally, it is fighting outright bans or legal challenges in several countries, including Spain, France and Germany.

If the Government holds firm, it won't be for want of trying by Uber. Andrew Byrne, Uber's London-based head of public policy, lobbied several ministers in the last government in 2015, as did John Moran, former secretary general of the Department of Finance, on Uber's behalf.

The lobbying register shows Byrne also met Shane Ross this summer, with the intended results stated on the register as “better transportation services for the Irish public”, while Moran’s company, RHH International, has appeared twice on the register in 2016 in connection with Uber. Its lobbying returns state the intended results as a bid to “bring Ireland’s rules up to best international practice and to take account of new technology”.

Technology goes to the heart of the issue. Uber, which is valued at $62.5 billion, claims it is not a transportation provider at all, but a technology company.

The European Court of Justice has been asked by a Barcelona court to decide on that very question. If it rules that Uber is a digital service, it may leave EU member states including Ireland hamstrung in their bid to regulate not just their taxi industries, but their wider transport sectors. It would bode ill for the quality of employment within.

For its part, the employment tribunal in Farrar’s case agreed with the conclusion of a Californian district court in 2015: “Uber is no more a ‘technology company’ than Yellow Cab is a ‘technology company’ because it uses CB radios to dispatch taxi cabs.”