UK Uber drivers and the future of work
Workers in the casual or gig economy have slowly been gaining some recognition and rights, but I argue here that in the global labour market brought about as a consequence of the politics of global competitiveness, this is part of a larger process in which the ‘standard labour contract’ and the relative protection from dismissal that it entailed is being replaced by a new standard that makes all work precarious.
The background: on 19 February 2021, the UK Supreme Court ruled, on a case first brought in 2016, that drivers for Uber’s platform-based ride-hailing service, were not ‘self-employed’, but had the right to be classified as workers under UK law. Four weeks later, Uber agreed to pay its UK taxi drivers the minimum wage, to contribute to their pensions and to recognise their right to holiday pay. Considered in isolation, this was a victory. But looked at in the wider context, I shall say, it was a massive defeat for workers.
If you were in the UK, and up early enough on Wednesday 17 March to listen to ‘Wake Up to Money’, the BBC Radio Five Live business programme from 5 to 6 a.m., you would have heard Uber’s Northern and Eastern European regional director, Jamie Heywood, being interviewed about the ruling. Heywood, by the way, joined Uber in 2018 from Amazon, where he was Director of their UK Electronics division, and previously worked for Virgin Mobile in Asia and the UK. He is an internationally experienced manager in the new technology industries. He clarified that this change was specific to the UK, and was made possible because UK law differentiates between ‘workers’ and ‘employees’, and gives them different sets of rights. ‘Employees’, in UK law, are workers as they were once generally understood, with rights to holiday pay and pension contributions, and to contractually agreed wages and security of employment, set hours of work, sick pay, and redundancy entitlement if dismissed. Workers, in contrast, have only a right to holiday pay, employers’ pension contributions if their hours are sufficient, and the minimum wage. No minimum number of hours, no sick pay, no right to redundancy payments.
This is the new model for workers’ rights, arising out of technological change and the flexibility of the ‘gig’ economy. The Uber decision is the first step in the regulation of workers’ rights in that economy, and it makes perfect sense if your goal is the maximum level of competitiveness, in a market where the same rules apply to all competing capitalists and workers. The basic principles of the model are first, there are no fixed hours of work - you get the hours you volunteer for or are given. Second, you are only paid for the hours you work. Third, you qualify for the minimum wage. Fourth, you accrue holiday pay and pension rights. Fifth, that’s all, folks. As this model becomes general, plenty of professions will be organised along these lines: in many cases pay will be above the minimum wage, but otherwise these conditions will apply. So it doesn’t only concern Uber drivers or Deliveroo riders. It is a blueprint for the casualisation of labour everywhere outside Fordist industry, not least in the already heavily casualised job of university teaching. Think about accountancy, for example; or the whole of the digital economy where code writers, graphic artists and the like can work from home; or nursing, or the care industry, where agency work already dominates, and you will get a sense of the future world of work. In some jobs, competition is effectively global. In the case of taxi services, it is not – a driver in Manchester cannot offer for a ride in Berlin. So Uber need only make these concessions in the UK, pending possible court action in other jurisdictions.
The judgement in the Uber decision, by the way, was that Uber drivers qualified for the minimum wage for the whole period in which they were logged on and available for rides, whether or not they were actually engaged with a passenger. But Uber has not agreed to pay for time logged on without a ride. What will happen if and when this goes back to court? The Supreme Court judgement relates to 2016, when Uber drivers were deemed to be employees of Uber at all times because there were in practice no alternative riding services to which they could offer themselves for work; and Uber at that time did not allow drivers to turn down a ride, so in effect insisting on exclusivity. But it noted that if Uber drops this requirement, as it is doing, and if competitors appear, as they are doing, drivers may be judged to be able to work for a number of rival platforms, and therefore to be working for Uber only when committed on a ride. This implies that the whole taxi/minicab industry will quickly become completely casualised, with drivers competing for work across multiple platforms – in other words, a perfectly competitive labour market, with minimal barriers to entry, a minimum wage which is also a maximum wage, and no provision for sickness. Again, this is not a model just for this particular service industry, but for a whole range of professional services.
What is the bigger picture here? Behind the scenes, the Paris-based Organisation for Economic Cooperation and Development is busy promoting the UK category of ‘worker’ to other OECD members, and proposing regulatory frameworks to govern this new world of work. Its 2019 publication, The Future of Work, addresses the ideal form of labour regulation and social protection for what it calls ‘non-standard work’, defined as ‘all temporary, part-time and self-employment arrangements, i.e. everything deviating from the “standard” of full-time, open-ended employment with a single employer’ (Box 2.3, p. 52): it wants this to become the norm. Diversity in employment contracts, it says, can provide ‘welcome flexibility for many firms and workers’, so long as challenges surrounding the quality of non-standard work are met – the first being ‘determined policy action … to ensure a more equal sharing of the costs of structural adjustment in the world of work’ (ibid, p. 19). Naturally, the costs are not to be shared equally between workers and employers, but equally between all workers. The permanent worker for a single employer is declared to be anachronistic and over-privileged, and the category of non-standard work is employed to ratchet levels of protection down to a new lower floor: non-standard workers must have ‘access to labour and social protection’, but by definition this will fall short of a permanent, full-time contract with attendant benefits. So social protection systems, which ‘play a key stabilising role in the current context of heightened uncertainties about the pace and extent of labour market changes’, require reform to make them more agile, with casual workers required to be actively searching for work, and entitlements made portable across jobs to facilitate mobility (ibid, pp. 20-21).
The OECD wants labour markets to be stocked with mobile and flexible workers embedded in social protection regimes that oblige them to maintain and renew a portfolio of market-relevant skills, and compete on a potentially global scale for work that is fragmented and inherently precarious. And it refers directly to the UK definition of the worker and the Uber case: ‘While the original intention of the worker category was to broaden the reach of protective regulations to a greater number of workers’, it says, ‘the creation of this separate category of workers may have shifted the objective of litigation down from obtaining employee status to merely obtaining worker status – as has been evidenced in recent course cases involving ride-sharing services (ibid, p. 143). Non-standard workers, currently one in six workers in the OECD countries, acquire basic rights. The great majority, in due course, have their rights reduced to the same basic level. Be careful, then, what you wish for.
References
Adams Abi, Zoe Adams, and Jeremias Prassl. 2019. Legitimizing Precarity: Zero Hours Contracts in the United Kingdom. In: O’Sullivan M. et al. (eds) Zero Hours and On-call Work in Anglo-Saxon Countries. Work, Organization, and Employment. Springer, Singapore. https://doi.org/10.1007/978-981-13-6613-0_3.
Adams, Abi, Judith freedman and Jeremias Prassl. 2018. Rethinking legal taxonomies for the gig economy, Oxford Review of Economic Policy, 34, 3, pp. 475–494.
The background: on 19 February 2021, the UK Supreme Court ruled, on a case first brought in 2016, that drivers for Uber’s platform-based ride-hailing service, were not ‘self-employed’, but had the right to be classified as workers under UK law. Four weeks later, Uber agreed to pay its UK taxi drivers the minimum wage, to contribute to their pensions and to recognise their right to holiday pay. Considered in isolation, this was a victory. But looked at in the wider context, I shall say, it was a massive defeat for workers.
If you were in the UK, and up early enough on Wednesday 17 March to listen to ‘Wake Up to Money’, the BBC Radio Five Live business programme from 5 to 6 a.m., you would have heard Uber’s Northern and Eastern European regional director, Jamie Heywood, being interviewed about the ruling. Heywood, by the way, joined Uber in 2018 from Amazon, where he was Director of their UK Electronics division, and previously worked for Virgin Mobile in Asia and the UK. He is an internationally experienced manager in the new technology industries. He clarified that this change was specific to the UK, and was made possible because UK law differentiates between ‘workers’ and ‘employees’, and gives them different sets of rights. ‘Employees’, in UK law, are workers as they were once generally understood, with rights to holiday pay and pension contributions, and to contractually agreed wages and security of employment, set hours of work, sick pay, and redundancy entitlement if dismissed. Workers, in contrast, have only a right to holiday pay, employers’ pension contributions if their hours are sufficient, and the minimum wage. No minimum number of hours, no sick pay, no right to redundancy payments.
This is the new model for workers’ rights, arising out of technological change and the flexibility of the ‘gig’ economy. The Uber decision is the first step in the regulation of workers’ rights in that economy, and it makes perfect sense if your goal is the maximum level of competitiveness, in a market where the same rules apply to all competing capitalists and workers. The basic principles of the model are first, there are no fixed hours of work - you get the hours you volunteer for or are given. Second, you are only paid for the hours you work. Third, you qualify for the minimum wage. Fourth, you accrue holiday pay and pension rights. Fifth, that’s all, folks. As this model becomes general, plenty of professions will be organised along these lines: in many cases pay will be above the minimum wage, but otherwise these conditions will apply. So it doesn’t only concern Uber drivers or Deliveroo riders. It is a blueprint for the casualisation of labour everywhere outside Fordist industry, not least in the already heavily casualised job of university teaching. Think about accountancy, for example; or the whole of the digital economy where code writers, graphic artists and the like can work from home; or nursing, or the care industry, where agency work already dominates, and you will get a sense of the future world of work. In some jobs, competition is effectively global. In the case of taxi services, it is not – a driver in Manchester cannot offer for a ride in Berlin. So Uber need only make these concessions in the UK, pending possible court action in other jurisdictions.
The judgement in the Uber decision, by the way, was that Uber drivers qualified for the minimum wage for the whole period in which they were logged on and available for rides, whether or not they were actually engaged with a passenger. But Uber has not agreed to pay for time logged on without a ride. What will happen if and when this goes back to court? The Supreme Court judgement relates to 2016, when Uber drivers were deemed to be employees of Uber at all times because there were in practice no alternative riding services to which they could offer themselves for work; and Uber at that time did not allow drivers to turn down a ride, so in effect insisting on exclusivity. But it noted that if Uber drops this requirement, as it is doing, and if competitors appear, as they are doing, drivers may be judged to be able to work for a number of rival platforms, and therefore to be working for Uber only when committed on a ride. This implies that the whole taxi/minicab industry will quickly become completely casualised, with drivers competing for work across multiple platforms – in other words, a perfectly competitive labour market, with minimal barriers to entry, a minimum wage which is also a maximum wage, and no provision for sickness. Again, this is not a model just for this particular service industry, but for a whole range of professional services.
What is the bigger picture here? Behind the scenes, the Paris-based Organisation for Economic Cooperation and Development is busy promoting the UK category of ‘worker’ to other OECD members, and proposing regulatory frameworks to govern this new world of work. Its 2019 publication, The Future of Work, addresses the ideal form of labour regulation and social protection for what it calls ‘non-standard work’, defined as ‘all temporary, part-time and self-employment arrangements, i.e. everything deviating from the “standard” of full-time, open-ended employment with a single employer’ (Box 2.3, p. 52): it wants this to become the norm. Diversity in employment contracts, it says, can provide ‘welcome flexibility for many firms and workers’, so long as challenges surrounding the quality of non-standard work are met – the first being ‘determined policy action … to ensure a more equal sharing of the costs of structural adjustment in the world of work’ (ibid, p. 19). Naturally, the costs are not to be shared equally between workers and employers, but equally between all workers. The permanent worker for a single employer is declared to be anachronistic and over-privileged, and the category of non-standard work is employed to ratchet levels of protection down to a new lower floor: non-standard workers must have ‘access to labour and social protection’, but by definition this will fall short of a permanent, full-time contract with attendant benefits. So social protection systems, which ‘play a key stabilising role in the current context of heightened uncertainties about the pace and extent of labour market changes’, require reform to make them more agile, with casual workers required to be actively searching for work, and entitlements made portable across jobs to facilitate mobility (ibid, pp. 20-21).
The OECD wants labour markets to be stocked with mobile and flexible workers embedded in social protection regimes that oblige them to maintain and renew a portfolio of market-relevant skills, and compete on a potentially global scale for work that is fragmented and inherently precarious. And it refers directly to the UK definition of the worker and the Uber case: ‘While the original intention of the worker category was to broaden the reach of protective regulations to a greater number of workers’, it says, ‘the creation of this separate category of workers may have shifted the objective of litigation down from obtaining employee status to merely obtaining worker status – as has been evidenced in recent course cases involving ride-sharing services (ibid, p. 143). Non-standard workers, currently one in six workers in the OECD countries, acquire basic rights. The great majority, in due course, have their rights reduced to the same basic level. Be careful, then, what you wish for.
References
Adams Abi, Zoe Adams, and Jeremias Prassl. 2019. Legitimizing Precarity: Zero Hours Contracts in the United Kingdom. In: O’Sullivan M. et al. (eds) Zero Hours and On-call Work in Anglo-Saxon Countries. Work, Organization, and Employment. Springer, Singapore. https://doi.org/10.1007/978-981-13-6613-0_3.
Adams, Abi, Judith freedman and Jeremias Prassl. 2018. Rethinking legal taxonomies for the gig economy, Oxford Review of Economic Policy, 34, 3, pp. 475–494.