car on freeway overpass

UK Uber Drivers Will Now Be Classified as Workers

UK Labor Laws

This week, Uber (UBER) announced that it will classify over 70,000 drivers in the UK as workers, not contractors. As a result, the ride-share company will pay its UK drivers the minimum wage, which is 8.72 pounds (or $12.12). Drivers will also receive vacation pay, access to a pension plan, and other benefits.

UK labor laws are somewhat unique in that there is a middle ground between freelancers and full time employees. Uber drivers will be designated as “workers” and will receive the benefits which accompany this distinction. But they will not legally be “employees” therefore they will not receive maternity and paternity leave or severance pay.

Legal Battles at Home and Abroad

These changes come after Uber lost an appeal with the British Supreme Court last month. The court ruled that Uber drivers are not independent contractors and are entitled to protections.

Uber has faced a number of similar legal battles around the world. Until now, the company has fought off regulations. For example, Uber won a case last November surrounding the question of whether drivers should be treated as employees in its home state of California.

Down the Road for Uber

Uber has argued that it is a tech platform used for connecting passengers and drivers, not an employer. Now it must alter its business model in the UK, and it could also have to make changes in other countries soon.

Lawmakers in the US and the European Union are considering implementing more protections for gig-economy workers like Uber drivers, which would affect Uber’s balance sheets. In 2020, Uber reported net losses of $6.8 billion. But demand for travel and transportation is beginning to climb again, so Uber may be able to regain strength and share some of its success with its drivers.

Things are changing daily within the financial world. Sign up for the SoFi Daily Newsletter to get the latest news updates in your inbox every weekday.

Sign up

Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.

All your finances.
All in one app.

SoFi QR code, Download now, scan this with your phone’s camera

All your finances.
All in one app.

App Store rating

SoFi iOS App, Download on the App Store SoFi Android App, Get it on Google Play

ABOUT SoFi SoFi helps people achieve financial independence to realize their ambitions. Our products for borrowing, saving, spending, investing, and protecting give our more than one million members fast access to tools to get their money right. SoFi membership comes with the key essentials for getting ahead, including career advisors and connection to a thriving community of like-minded, ambitious people. For more information, visit Want an easy and convenient way to manage your financial life? Get the SoFi app. For iOS and Android.

TLS 1.2 Encrypted
Equal Housing Lender