25 May 2018

Uber has offered its drivers a new insurance scheme that provides them with workers' rights following increasing pressure from unions, but the deal falls short of what the drivers would likely be legally entitled to if they took their case to court.

The move has come after the company came under increasing pressure for avoiding employment rights laws by classifying drivers as 'independent contractors' (and therefore not eligible for workers' rights), despite tribunals finding that drivers who have taken their case to court were legally deemed 'workers' and therefore entitled to the Minimum Wage and holiday pay.

Since 2017, Uber has offered a pay-for insurance scheme to drivers to cover losses in the event of illness or injury, but now they have enhanced that scheme and made it free for all taxi drivers who have completed at least 150 trips in the last eight weeks, or Uber Eats workers who have completed at least 30 deliveries in the last eight weeks.

Drivers can now access a lump sum of £7,500 in medical cover, £50,000 for a permanent injury related to the job, bereavement pay, and sickness pay of up to £75 per day for 15 days and £30 a day for a further 15 days.

The new scheme also provides a £1,000 lump sum to drivers who have a child - much lower than statutory maternity pay of 90% of earnings before tax for six weeks followed by £145.18 per week for a further 33 weeks (or 90% of pay if this is lower).

GMB, the union which brought the landmark case against Uber that found its drivers were workers, said Uber moving towards offering workers' rights is a "hard-fought victory".

"This is a major step in the right direction, but our successful court victories, winning workers’ rights for Uber drivers, could have all been avoided if they had sat down and talked with GMB from the start," Mick Rix, GMB National Officer, said.

The Institute of Employment Rights recommends, in our Manifesto for Labour Law, two key actions that could provide casual workers with security of employment and access to fair pay and conditions. Firstly, the three-tier employment status system should be scrapped in favour of a universal definition of 'worker' that applies to all people in employment and provides for the full suite of rights from day one. Secondly, sectoral collective bargaining should be re-instated so that trade unions and employers' associations can negotiate for minimum wage and contract deals across entire industries, covering casual workers as well as permanent employees regardless of whether or not they are a member of a union.