After a long wait the tribunal decision has gone against Uber.
The immediate reaction of the taxi App company is that they will appeal.
But what will this all mean for the future of Uber in the UK.
As it stands the decision only states that Uber must comply with the minimum wage regulations, paid holidays must be provided and regular paid breaks should also be included.
At the moment this only applies to the two people who are involved in the tribunal itself but it must have an effect on the 40,000 drivers using the Uber app in the UK.
The thin end of the Wedge
If Uber lose the appeal we have to ask where will all this end?
Pension payments are already being drawn into this situation and there are many other implications such as:
- Will Uber have to set up PAYE systems and deduct Tax and NI as their drivers will be employees.
- Will Uber be liable for VAT. At the moment individual drivers do not exceed the level of pay that makes it compulsory to pay and also Charge VAT.
- Maternity leave for employees.
All these areas are still to be decided and have not been brought into the scope of the tribunal.
What will be the effects
These benefits will be good for driver giving them much better working conditions but the effect on Uber could be devastating.
If you add together the cost of:
Paying drivers by the hour, at minimum wage, for all hours workers.
Providing holiday and pensions payments
Providing paid breaks
This alone could result in Uber making the decision to pull-out of the UK, something which they have done in other cases.
If you were then to add the administration cost of running PAYE systems and VAT systems you can see deap trouble ahead.
The final blow would be having to add VAT to there current fares without becoming noncompetitive compared to other Taxi providers.
Time is not of the Essence
What ever happens it will be quite some time before anything more is decided and because of the implications for all other similar ” self employed” based enterprises and so there is no need to panic.
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