Here’s our report on the Uber verdict, from Hilary Osborne:
Drivers for Uber have won a landmark case after employment tribunal judges ruled that they were not self-employed and should be paid the national living wage.
The case could open up the technology firm to claims from all of its 40,000 drivers in the UK, and force other companies in the so-called gig economy to review the way that they are employing staff. It is likely that the firm will appeal against the finding.
The ride hailing app had argued that the drivers were independent contractors who are self-employed and can choose where and when they work.
But an employment tribunal in London found that this was not the case.
The full story is here:
The Uber ruling is disappointing for its 40,000 drivers and consumers alike, according to the Adam Smith Institute. Sam Dumitriu, head of projects at the think tank, said:
Nearly 80% of Uber drivers preferred being self-employed and being their own boss, saying in a recent poll that they wouldn’t trade that status for some of the benefits like holiday pay, pension contributions and the National Minimum Wage.
Uber drivers typically earn well above the National Living Wage. Across the UK, the average driver earns £16 an hour, that’s after Uber has taken their commission, but before you factor in extra costs like insurance, petrol and car payments. One you factor that in it comes to around £12 an hour, still well above the minimum wage. It’s higher for drivers in London and it’s higher for drivers who work at peak times like Saturday evening.
Consumers will see prices rise and a less stable, predictable service. And this doesn’t just hit Uber. It threatens other new business models like Deliveroo and Amazon Prime Now.
TUC: The gig economy is rigged against workers
Unions are understandably delighted to have won today’s case against Uber.
TUC General Secretary Frances O’Grady says it’s an important step towards cleaning up the ‘gig economy’ (which relies on temporary, often low paid, workers).
“The GMB deserve huge credit for a shining light on conditions at Uber and winning this landmark action.
“This case has exposed the dark side of so-called ‘flexible’ labour. For many workers the gig economy is a rigged economy, where bosses can get out of paying the minimum wage and providing basics like paid holidays and rest breaks.
O’Grady adds that Theresa May’s government also needs to take action to prevent workers being exploited:
“What is happening at Uber is just the tip of the iceberg. Lots of people are now trapped in insecure jobs, with low pay and no voice at work.
“We need the government to get tough on sham self-employment. The Taylor review of employment practices must be a no-holds-barred investigation. And it must recognise the important role trade unions can play in ending precarious working.”
The Uber ruling could trigger a wave of claims from workers at other companies.
Frank Ryan, employment lawyer at legal firm Vardags, says:
“This is a landmark decision which is guaranteed to have widespread implications: for Uber itself, its workers, the paying public, black cab drivers and other workers in the so called gig economy. While each case turns on its own facts, this is essentially a green light for others in the gig economy to come forward and make similar claims.
Ryan also argues that consumers could end up paying more for cab rides:
While potentially good news for black cab drivers, who have always struggled to compete with Uber and who will already have been encouraged by the Mayor of London’s package of reforms for the taxi sector, it’s ultimately bad news for the consumer. It is surely unavoidable that Uber will look to pass the resultant increased costs onto the paying customer.
Uber to appeal after losing tribunal
Uber has swiftly responded, saying it will appeal against the UK tribunal ruling that its drivers should be treated as employees.
It argues that most drivers are happy with the current situation.
Jo Bertram, regional general manager of Uber in the UK, says:
“Tens of thousands of people in London drive with Uber precisely because they want to be self-employed and their own boss.
The overwhelming majority of drivers who use the Uber app want to keep the freedom and flexibility of being able to drive when and where they want. While the decision of this preliminary hearing only affects two people we will be appealing it.”
Uber drivers’ lawyers: We’ve won!
Newsflash: Back in London, the lawyers representing a group of Uber drivers say they have won a court case, at which they argued that the workers are employed by the taxi hire firm.
The ruling means that Uber drivers will be entitled to employment benefits, and could be a major moment in the evolution of the new ‘gig’ economy.
The London Central Employment Tribunal has found that a group of Uber drivers are workers and are entitled to receive the National Minimum Wage and holiday pay.
In a landmark ruling that follows a hearing in July, which will affect tens of thousands of Uber drivers, the Employment Tribunal has ruled today that a group of Uber drivers are not self-employed but are workers who are entitled to essential workers’ rights including to be paid the National Minimum Wage and receive paid holiday.
The US economy has regained momentum, says Paul Ashworth, chief US economist at Capital Economics.
The stand-out in the third quarter was the 10.0% surge in exports. Admittedly, some of that surge was due to a one-off spike in soybean exports, which will be reversed in the fourth quarter, but it is still a welcome sign that the dollar appreciation in 2014 and 2015 is no longer weighing on exporters. Overall, net exports added 0.8% points to GDP growth. After being a sizeable drag on growth for the preceding five quarters, inventories added a further 0.6% points.
But….Ashworth also points out that not everything was rosy:
Consumption growth slowed to 2.1%, residential investment contracted by 6.2% and equipment investment fell by 2.7%FacebookTwitterGoogle plus
Paul Sirani, chief market analyst at City trading firm Xtrade, believes US interest rates are now likely to rise in December.
“The last time US GDP growth surged past two per cent the Federal Reserve raised interest rates. With today’s numbers flying above that watermark, history may be about to repeat itself.
“The world’s largest economy is being fuelled by a buoyant jobs market, strong levels of consumer spending and healthy trade. If the indicators continue to point upwards for the US then Fed Chair Janet Yellen will look to stop things boiling over.
“Many believe that today’s big bump in growth will assure a December rate rise, but with a US election just weeks away, nothing is certain.”FacebookTwitterGoogle plus
What does this stronger growth mean for US interest rates?
On balance, you’d expect that stronger growth raises the chances that the Federal Reserve hikes borrowing costs at its December meeting.
Investor Adrial Miller thinks to:But….Anna Stupnytska, global economist at Fidelity International, argues that some Fed policymakers could make a case for holding rates again: