Uber Technologies Inc. will classify tens of thousands of drivers in the United Kingdom as “workers” starting Wednesday, meaning they are still not considered employees but will be entitled to a minimum wage, holiday pay and possibly pensions.
Uber UBER, -2.23% announced the changes Tuesday afternoon in a filing with the Securities and Exchange Commission in response to the U.K.’s Supreme Court order last month. The company had been fighting a case brought by two Uber drivers to a London employment tribunal in 2016, and appealed to the Supreme Court after losing three earlier rounds in the battle, according to the BBC.
The U.K. App Drivers & Couriers Union, which was founded by the drivers who brought the original case, said on Twitter that it welcomed the Uber changes but that they fall short of what the ruling called for.
“The Supreme Court ruled that drivers are to be recognized as workers with entitlements to the minimum wage and holiday pay to accrue on working time from log on to log off whereas Uber is committing only to these entitlements to accrue from time of trip acceptance to drop off,” the union said, adding that drivers would be “shortchanged to the tune of 40-50%.”
This development is the latest in the long-running saga of driver classification, a battle that Uber has been fighting for years in many of the markets where it operates. Spain last week announced that gig workers should be treated as employees, and the European Commission recently launched a consultation as it seeks to improve working conditions for gig workers.
In the U.S., Uber won a classification fight in its home state of California in last November’s election. Under the voter-approved Proposition 22, Uber drivers gained a guaranteed wage and possible stipends for health benefits but remain independent contractors — falling under a third category of employment status like the drivers in the U.K., a model the company wants to expand elsewhere.
The company is facing a federal challenge to that effort in the PRO Act, federal legislation that was passed by the U.S. House of Representatives last week. The bill is likely to encounter opposition in the Senate.
The ride-hailing giant said in the SEC filing that its U.K. rides business comprised 6.4% of its mobility gross bookings in the fourth quarter. It also said it would not adjust previous expectations for adjusted EBITDA for the first quarter or for the year.
The minimum wage in the U.K. is 8.72 pounds an hour; the company said in the filing that its more than 70,000 drivers in the region typically make 17 pounds an hour in London and 14 pounds an hour elsewhere.
An Uber spokesman declined further comment.
Shares of Uber, which had fallen 2.2% to end the day’s session at $58.85, were down an additional 1% after hours. They have risen more than 15% so far this year, and are up 211% in the past 52 weeks.
March 17, 2021 at 06:18AM
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Uber to label U.K. drivers as workers, provide minimum wage, holiday pay and pensions - MarketWatch
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