LONDON (AP) – Uber is giving its drivers in the UK the minimum wage, pensions and vacation allowance after a recent court decision that said they should be classified as workers and be entitled to such benefits.
The race that greeted the giant’s announcement on Tuesday comes after it lost an appeal last month to the UK Supreme Court after a court battle of years. The court’s decision has broader implications for the country’s gig economy.
Uber said it is extending the benefits immediately to its more than 70,000 drivers in the UK. Drivers will earn at least the minimum wage, which is currently £ 8.72 ($ 12.12), after accepting a travel and expenses request, and they can still earn more.
Drivers will also receive a vacation payment equal to about 12% of their earnings, paid every two weeks. And they will be enrolled in a pension plan that they and the company will pay.
“This is an important day for drivers in the UK,” said Uber general manager for northern and eastern Europe, Jamie Heywood, in a filing with the SEC. He noted that drivers will still be able to work flexibly. “Uber is just one part of a large private rental industry, so we hope that all other operators will join us in improving the quality of work for these important workers who are an essential part of our daily lives.”
The drivers who filed the case welcomed the news, but said it was not enough.
Uber “came to the table with this offer a day late and literally a dollar less,” said James Farrar and Yaseen Aslam of App Drivers And Couriers Union in a statement. They said the changes did not reach a Supreme Court decision that payment should be calculated from the moment drivers access the app until logoff. And they said that the company cannot decide on its own the cost base for calculating the minimum wage, which should be based on a collective bargaining agreement.
Farrar and Aslam took the case to an employment tribunal, which concluded that drivers are not independent contractors, but must be designated workers, which, under British law, means their terms of employment are more casual than employees, but they still bring some benefits. Uber lost two rounds of appeals before the Supreme Court decision.
Offering more benefits to its drivers is likely to increase costs for Uber, based in San Francisco, which was already struggling to make a profit and had already faced regulatory problems in London, where authorities had sought to revoke its license. She said, however, that she was not adjusting her earnings forecast for the year.
The move in the UK contrasts with the result of a November vote in California, where voters approved an initiative that exempts hitchhikers and application-based food delivery services from classifying their drivers as employees rather than contractors.
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