Uber has lost an appeal over its drivers being classed as workers in a landmark ruling for the gig economy.
Seven justices ruled against Uber operating companies, saying that drivers should be classed as workers, at a Supreme Court ruling this morning.
Uber operating companies, who argued that drivers were contractors and not workers, launched a final appeal after losing three earlier rounds of the fight.
The firm will not be able to appeal the ruling again and lawyers said the result will have huge implications for others working in the gig economy.
Justices unanimously dismissed Uber’s appeal with Justice Lord Leggatt saying: “I think it clear that the employment tribunal was entitled to find that the claimant drivers were ‘workers’.”
Uber could end up paying thousands to drivers in compensation.
In 2016, an employment tribunal ruled that Uber drivers were workers, and were entitled to workers’ rights.
The ruling was upheld by an employment appeal tribunal, and by Court of Appeal judges - but lawyers representing Uber operating companies told Supreme Court justices that ruling was wrong.
They said drivers did not “undertake to work” for Uber but were “independent, third party contractors”.
But lawyers representing drivers said the tribunal was entitled to conclude that drivers were working and that Uber’s appeal should be dismissed.
A law firm enlisted by the GMB union to represent Uber drivers says drivers should now be entitled to compensation for lost pay.
Experts say Uber customers could see a price hike after lawyers predicted the company could be liable to pay drivers thousands of pounds as a result of the ruling.
Leigh Day lawyers think tens of thousands of Uber drivers could be entitled to an average of £12,000 each.
The case is due to return to an employment tribunal for decisions to be made on how much compensation drivers should get.
Commenting on today's ruling, Paul Chamberlain, head of employment at Manchester law firm JMW Solicitors, said: “This is a landmark case for the gig economy - lawyers acting on behalf of the drivers estimate that Uber could be liable to pay workers an average of £12,000 in compensation, along with holiday pay, sick pay and at least the national minimum wage.
"Uber cannot appeal the decision further, so we may see the business looking to pass on its increased operating costs to customers using the platform.
"Today’s decision could be decisive for similar worker status cases and is likely to encourage those employed in similar gig economy roles to bring claims to enforce their rights as workers."
Mick Rix, GMB national officer, said: “This has been a gruelling four-year legal battle for our members – but it’s ended in a historic win.
“The Supreme Court has upheld the decision of three previous courts, backing up what GMB has said all along; Uber drivers are workers and entitled to breaks, holiday pay and minimum wage.
“Uber must now stop wasting time and money pursuing lost legal causes and do what’s right by the drivers who prop up its empire.
“GMB will now consult with our Uber driver members over their forthcoming compensation claim.”
