Former Uber Eats courier paid $400,000 in out-of-court settlement
Is an Uber Eats courier an employee or an independent contract worker? The line that separates the two classifications is becoming increasingly blurred, especially in the gig economy.
Uber Eats courier brings unfair dismissal case before Fair Work Commission
In 2019, after being told she’d failed to meet delivery time standards, Uber Eats courier Amita Gupta had her access cut off. With the support of the Transport Workers’ Union, Ms Gupta brought an unfair dismissal case against Uber.
The Fair Work Commission dismissed Ms Gupta’s application. In 2020, the Transport Workers’ Union lodged an appeal on her behalf.
The full bench of the Fair Work Commission, led by President Justice Iain Ross, ruled that Ms Gupta was not an employee of the company and that under the Fair Work Act 2009, did not come under unfair dismissal laws. (See Amita Gupta v Portier Pacific Pty Ltd; Uber Australia Pty Ltd t/a Uber Eats.)
Uber Eats courier not conducting her own business
It was an unusual decision by the Fair Work Commission. The full bench held that the Uber Eats courier was not in a business relationship with Uber, but that she did work for the business.
The commission rejected Uber’s argument that their couriers were conducting their own businesses, and that Uber was only an agent for the restaurants in arranging delivery.
The Fair Work Commission said that Uber Eats set couriers’ pay, banned them from delegating work and hindered them from making their own agreements with restaurants for delivering meals. Uber maintains complete control over payment for each courier’s work and enforces standards of delivery through a rating system.
Some essential hallmarks of employment relationship lacking
On the other hand, the commission said that an Uber Eats courier does not meet the criteria of an “employee”, either.
The full bench held that there was nothing unusual in enforcing quality and performance standards in both independent contractors and employee relationships. It ruled that couriers lacked some of what it said were “the essential hallmarks of an employment relationship”. (See Fair Work Ombudsman, Independent Contractors.)
The full bench pointed out that an Uber Eats courier can log on and off at will, can work for other food delivery outlets and can decide whether to accept deliveries or not. The couriers did not have to wear a uniform or display a company logo and were responsible for their own vehicles.
The company did not deduct tax from the couriers’ pay or make contributions to a superannuation fund on their behalf.
Uber Eats settles with courier before Federal Court appeal decided
After the Fair Work Commission rejected Ms Gupta’s appeal in 2020, the union took the case to the Federal Court, arguing that while the case had been dismissed, the ruling had also found that Uber was a transport service which has responsibilities to its workers.
After the first hearing in the Federal Court, Uber Eats settled the unfair dismissal case with Ms Gupta for $400,000.
If the case had gone ahead and Ms Gupta had won, it could have set a legal precedent that couriers are employees, rather than contractors. This potential outcome would destroy Uber’s current business model, by entitling gig economy workers to receive a minimum wage, annual leave and unfair dismissal protection.
Whether a worker is an employee or contractor is a vexed question, particularly in the gig economy, and it will continue to be fought out in the courts. If you are involved in a situation like this, it’s wise to consult a lawyer experienced in employment law.
Contractor or employee? – Further reading
For more information on the question of whether a worker is a contractor or an employee, please see the articles below.