Uber drivers and employment rights
In a Fair Work Commission hearing in December 2017, Deputy President Val Gostencnik found that under Australian law, Uber drivers are independent contractors, and therefore ineligible for unfair dismissal protection.
Deputy President Gostencnik agreed with Uber that under the terms that drivers must agree to, the relationship between drivers and Uber contained more characteristics of an independent contractor and principal relationship, rather than an employer and employee under the traditional Australian test.
The Uber App actually consists of two mobile applications – a Rider App and a Driver App. A rider and a driver each download their respective apps, which will then pair a rider and driver with each other.
Deputy President Gostencnik found that under the agreed terms between Uber and drivers, Uber owes no legal obligation to a driver other than provision of the free app and the remittance of fees paid by a rider to a driver. Uber does not pay drivers for their work or services, and therefore the work-wages bargain, which is the legal minimum for an employment relationship to exist, is absent. He also noted that this notion was not “seriously challenged”.
Some other factors that were found to disprove the existence of an employment relationship between drivers and Uber were that drivers can set their own hours in which they drive, choosing to work for as little or as long as they like; the drivers providing their own cars and insurance; and the fact that drivers are prohibited from displaying or wearing any Uber branding.
In his closing remarks, Deputy President Gostencnik noted that due to the new “gig economy”, the traditional tests for employment may be outmoded, or no longer reflect current economic circumstances and that in future, laws of employment may evolve or be developed by the legislature to keep pace with the digital economy. Until this occurred, Deputy President Gostencnik held, the traditional Australian tests of employment would continue to be applied.
For advice or further information please contact:
Jim Rutherford
Principal
Harwood Andrews
T: 03 5226 8579
E: jrutherford@ha.legal
or
Sonia McCabe
Senior Associate
Harwood Andrews
T: 03 5226 8558
E: smccabe@ha.legal
*This article was prepared with the assistance of work experience student, Hannah Brown
