In a new Productivity Insight Paper, Uber And Beyond: Policy Implications for the UK, Abi Adams-Prassl and Jeremias Adams-Prassl of the University of Oxford and Diane Coyle, member of the Productivity Institute’s Executive Team reveal the impact recent court judgements like Uber’s employment model could have on productivity and the broader gig economy.
In March 2021, the UK Supreme Court unanimously agreed that drivers from transportation network company, Uber were not genuinely self-employed, and thus were entitled to the full set of rights and protections associated with their new status as workers.
Uber CEO Dara Khosrowshahi then announced: “Uber drivers in the UK will be treated as workers, they will receive holiday pay and will be guaranteed at least the National Living Wage (as a floor, not a ceiling, meaning they will be able to earn more, as they do today). And eligible drivers who want a pension will receive one.”
The accumulation of similar precedents in courts around the world means that legal and regulatory pressures on the broader platform business model will continue.
This insight paper looks at the implications from the new policy including new flexibility for workers, business competition and a reduced UK tax base as most drivers are no longer liable because they earn less than the threshold.
Therefore is it time to think about a better framework for the gig economy to protect the UK economy?