Uber Eats workers: Independent contractors or employees?
A debacle for business owners is often to consider whether someone would be classified as a contractor or an employee. Clarification regarding this is assisted by a recent case where Uber Eats drivers were held by the Fair Work Commission (FWC) in a landmark decision to be independent contractors, not employees and as such are not entitled to minimum pay and conditions, rules the.
This decision means drivers are unable to claim employee entitlements, including leave benefits and the minimum pay safety net, as well as certain legal protections afforded to employees.
The FWC outlined three 'critical' factors in reaching their decision:
- Drivers can control when they log into the app, how long they login for and have the ability to accept or decline a delivery.
- Drivers may work for other food delivery services and engage in other forms of employment.
- There is no obligation upon drivers to represent Uber Eats, to identify themselves as a delivery driver for Uber Eats, other than what is necessary during collection and delivery.
Similarly, in 2019 the Fair Work Ombudsman ruled Uber drivers were not employed by Uber Australia. Ombudsman Sandra Parker stated:
“For [an employment] relationship to exist, the courts have determined that there must be, at a minimum, an obligation for an employee to perform work when it is demanded by the employer.”
While the FWC explained the employer-employee relationship did not exist, it did find there is a contractual relationship between food delivery drivers and Uber. Further, the FWC acknowledged Uber has the power to set drivers' pay, ban drivers, and prevent drivers from subcontracting work to others, but noted that this power did not meet the threshold of establishing an employer-employee relationship.
It may well be that litigation has not ended on this issue but the case gives some guidance about how the Commission sees the balance.
For assistance with your employment needs, contact Siobhan Liston on 03 5445 1067.