Supreme Court of the United Kingdom has ruled that drivers working for Uber are legally employed and not contractors.  The ruling will require Uber to pay the minimum wage and to provide benefits.

The Court rejected the Uber claim that it is a service technology provider functioning as an intermediary between independent drivers and customers.  Since Uber will now be required to pay standard wages and benefits, the cost of rides and delivery services will increase invalidating the low-cost for convenience model.  The decision will obviously impact the Uber delivery component of the company previously operating as UberEats. This will encourage direct delivery by restaurants and greater use of pickup especially as industrialized nations emerge from COVID restrictions.

The U.K. decision follows similar rulings by courts in France and Spain during 2020. These E.U. and U.K. decisions regarding the status of drivers will have no direct bearing as precedents in class-action lawsuits in Canada and on individual states in the U.S.  The legislation passed in California during 2019 classifying Uber and Lyft drivers as employees, was overturned in a November 2020 ballot.

In ruling on the lawsuit Lord Leggatt writing for the majority stated, “Drivers are in a position of subordination and dependency in relation to Uber such that they have little or no ability to improve their economic position through professional or entrepreneurial skill.”