Lawyers have predicted a ‘significant class action’ against Uber following a decision by the Supreme Court that its drivers should be classed as workers with access to the minimum wage and paid holidays.

In a judgment handed down this morning, six justices unanimously dismissed Uber’s appeal against a 2018 Court of Appeal ruling. The company argued that the drivers are self-employed independent contractors. The Supreme Court rejected this argument, ruling that Uber London contracts with passengers and engages drivers to carry out bookings for it.

Bates Wells LLP, which represented some of the drivers, said the judgment will have an ‘enormous impact’ on an estimated 45,000 Uber drivers in London and on the rights of gig economy workers more generally.

‘The Supreme Court held that Uber drivers are “workers”. This is still a form of self-employment but will guarantee Uber drivers’ basic protections including the national minimum wage, holiday pay, protection against discrimination and will require Uber to adhere to more extensive health & safety obligations,’ the firm said.

Paul Jennings, partner at Bates Wells said: ‘The ruling strikes at the heart of Uber’s business model. We anticipate there will be a significant class action against Uber. As a business, it will need to reflect very carefully on the implications of the judgement.’

In the immediate term, the practical implications of the decision – which relates to 35 Uber drivers – have yet to be determined.

Will Winch, an employment lawyer at Mishcon de Reya, said the ruling confirmed that the starting point when deciding whether someone is a  'worker' is not the contract but the purpose of the relevant employment legislation.

‘The court noted that workers are often in a weaker bargaining position, and warned against attempts to contract out of the statutory protections that exist to protect vulnerable individuals. This is a clear signal that workers – particularly in the gig economy – will be protected by the courts, irrespective of the nature of their contractual arrangements,' Winch said. 

Yvonne Gallagher, employment partner at Harbottle & Lewis, added that the outcome ‘may embolden trade unions to push for full employee status in future which would bring with it wider obligations the most significant of which would be an obligation to pay employers social security contributions on payments made to employees’.

Trade union GMB described today's judgment as a ‘historic win’.

The case will now return to the employment tribunal which will decide how much compensation drivers are entitled to. National firm Leigh Day, which represented some of the drivers, claims Uber drivers could be entitled to an average of £12,000 each in compensation.

Uber was represented by international firm DLA Piper.