(Reuters) – A group of Uber drivers are entitled to workers' rights as a minimum wage, the UK's Supreme Court ruled on Friday in a blow to the ride-sharing service that has consequences for millions of others in the gaming industry.
In a case led by two former Uber drivers, a labor court in London in 2016 ruled that they were entitled to rights that also included paid holidays and breaks.
Uber drivers are currently treated as self-employed, which means that by law they receive only minimal protection, a status that Silicon Valley-based companies tried to maintain a long-standing legal hassle. The legislation is intended to provide some protection for vulnerable individuals who have little or nothing to say about their pay and working conditions.
A total of 25 drivers were part of the case and Uber said the ruling did not apply to all of its current 60,000 drivers in the UK, of which 45,000 in London, one of its most important global markets.
"We respect the court's decision which focused on a small number of drivers using the Uber app in 201
"We are determined to do more and will now consult all active drivers across the UK to understand the changes they want to see."
Uber shares fell 3.4% in pre-market trading following the court's announcement.
Workers with gig economics
The gig economy, where people tend to work for one or more companies from job to job, has been criticized by unions who say it is exploitative, while companies say many of them working in it enjoys the flexibility.
It may still take several months for the details of Friday's decision to work on an additional employment relationship to sort through practical functions over amounts owed to drivers, according to lawyers.
The law firm Leigh Day states that eligible drivers may be entitled to an average of £ 12,000 ($ 16,780) in compensation. It represents more than 2000 potential claimants.
Uber has faced opposition from unions and challenges to its business model in several countries as it disrupts the taxi market.
In November, however, it looked like a challenge in the domestic market. in California, where voters supported a proposal that cemented app-based food delivery and drivers with the status of independent contractors, not employees.
One of the two former Uber drivers leading the British case, James Farrar, called on Prime Minister Boris Johnson's government to do more to reform the gaming economy.
"I am very happy that workers finally have a cure because of this decision, but the government must as soon as possible strengthen the law so that gambling workers can also have access to sick pay and protection against unfair dismissal.