An Uber Eats driver is appealing against a decision made by the Fair Work Commission (FWC). In this decision, Amita Gupta’s claim for unfair dismissal was rejected on the basis that she is a contractor (and not an employee). This is one of many legal disputes which the transport giant has faced. This is particularly so where it comes to defining the role of contractors and employees, and how terminations can occur.
What happened?
Amita Gupta was a driver for Uber Eats, and was dismissed for being 10 minutes late. Amita disputed this in the FWC, but this was rejected. This happened because the FWC considered her a contractor (and not an employee). However, Amita is disputing this finding because:
- Termination for lateness contradicts Uber’s assertion that drivers can choose their own hours
- ‘Mutuality of obligation’ exists between Uber and its drivers, a cornerstone of the modern employment relationship
- Uber Eats drivers are not contractors, they are employees
Depending on the outcome, this could be a game-changer for how companies such as Uber deal with their workers. This is because many companies in the gig economy hire workers on a contractual basis. Further, they cement this by requiring them to register for an Australian Business Number (ABN).
Yet there are many elements to this employment relationship which indicate that these workers may in fact be employees. This also follows a case last year where Foodora was found to have engaged in sham contracting. This was because Foodora exercised a degree of control over the hours, location and work done by its drivers. Despite this, Foodora attempted to classify these workers as contractors to avoid paying workers employee entitlements.
What rights do contractors have?
In Australia, contractors are not entitled to annual leave, superannuation or minimum wage. The trade off with this is that contractors can choose their hours and control how the work is done. Of particular note here is the fact that contractors can ‘decide what hours to work’. However, this contradicts Uber’s termination of Amita for being 10 minutes late.
Unfair Dismissal
In the majority of cases, contractors are not eligible to lodge a claim for unfair dismissal. However, contractors who are actually employees can bring a claim. In this sense, the appellant will need to show that she worked for Uber Eats, rather than carrying on an independent business. In this case, the Court will apply a multi-factor test to determine if Amita was a contractor or a worker. These factors include:
- The level of autonomy involved in the work
- Whether the worker can choose their hours
- If the worker bears financial risk or responsibility
- Whether the worker works on an ongoing basis or for a one-off project
- Whether the worker supplies their own tools and equipment
Has the gig economy become a breeding ground for sham contracting?
Disputes over whether workers at gig-economy companies are employees or contractors are nothing new. In fact, almost every company in the industry has faced a challenge on this front. This includes Uber, Foodora, Deliveroo and Uber Eats – all with different outcomes.
Further, overseas jurisdictions have also grappled with these questions. In 2018, the UK Court of Appeal found that Uber drivers were entitled to minimum wage, paid rest breaks and holiday pay. This has also resulted in wider calls for an overhaul to how contractors are classified in Australia. Whether or not policy makers answer these calls, this case could result in a fundamental shift in how workers in the gig economy operate.
