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Uber Drivers to receive National Minimum Wage, Holiday Pay & Pensions

BY Kirstie Beattie
Employment Law & HR

Following last month’s landmark Supreme Court judgment, where it was decided that Uber drivers are to be treated as workers under UK employment legislation, Uber have confirmed that all 70,000 of their UK drivers will now receive the national minimum wage as well as holiday pay and pensions. However, whilst this announcement has been generally well received, it has been claimed there are still caveats attached that do not appear to conform with the ruling set out by the Supreme Court.


What changes have been implemented?

As of 17 March 2021, Uber have committed to pay all drivers over the age of 25 at least the national minimum wage rate, minus vehicle running costs, but only once a trip request is accepted. This has been introduced alongside automatic enrolment into a company pension scheme for those deemed eligible, which both Uber and its drivers will contribute to, as well as paid holiday time based on 12.07% of their earnings, to be paid on a fortnightly basis. Drivers will also continue to receive free insurance cover in respect of sickness, injury and parental payments and maintain discretion over if, when and where they drive.

How have these changes been received?

Although many have heralded Uber’s announcement as a huge step forward in reshaping worker’s rights within the gig economy, there have been assertions from several Unions that Uber’s interpretation and reclassification lacks full compliance with the legal minimums set out, warranting intervention from HMRC. There are also concerns this so-called refusal from Uber to capitulate and fully accept their driver’s status will have a dissuasive effect on the wider gig economy.

In their judgment, the Supreme Court stated that Uber drivers were entitled to a guaranteed minimum wage whenever they log in to the app and are available for work. However, somewhat conversely, Uber have confirmed minimum wage and holiday pay will only accrue when drivers are actually transporting a passenger and will therefore not receive reimbursement for time spent travelling between jobs.

The Unions have also highlighted there is still ambiguity surrounding vehicle running costs as Uber are yet to clarify how these will be assessed during payment and holiday calculations. Elucidation on compensation for backdated pay and holidays remains outstanding and there has been no mention to date of the accompanying health and safety protections Uber drivers are now afforded under worker’s status.

At the time of publication, Uber had not provided a response in relation to these statements and no formal investigation has been initiated. We do however anticipate there will be an announcement from Uber in the near future and LAW will continue to keep you updated with any developments.

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