Uber Set to Recognize U.K. Union While Keeping Worker Model

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May 26 2021, 3:59 PMMay 26 2021, 5:33 PMMay 26 2021, 3:59 PMMay 26 2021, 5:33 PM

(Bloomberg) -- Uber Technologies Inc. plans to formally recognize a trade union in the U.K. that will give drivers increased powers to collectively bargain while also preserving the company’s worker model.

The ride-hailing giant is set to strike a deal that will allow Uber’s 70,000 drivers in the country to organize and collectively bargain under the GMB labor group, according to people familiar with the discussions. The deal, which could be announced as soon as Wednesday, will let drivers retain the ability to choose where and when they work, people said, asking not to be identified because the deal isn’t finalized.

It’s a move that follows a shakeup in Uber’s biggest European market after a landmark U.K. Supreme Court ruling in February forced the company to recognize a group of drivers as workers, entitling them to minimum wage, vacation pay and other benefits. The decision unleashed a slew of similar claims and ultimately Uber said it would extend the classification to all of its drivers in the country. The company reported $600 million in expenses related to the ruling in its financial results earlier this month.

A representative for Uber declined to comment. A representative for the GMB didn’t immediately respond to a request for comment.

The GMB trade union has more than 620,000 members, representing drivers, delivery workers, government employees and others, and was among labor groups to support the U.K. court case.

Uber has inked similar deals with labor groups in several countries, aiming to stem increasingly influential complaints about how drivers are treated while preserving a cornerstone of the company’s business model: the claim that drivers aren’t employees entitled to full workplace protections.

In New York, Uber worked with the International Association of Machinists to launch a group called the Independent Drivers Guild in 2016. Funded by the company and affiliated with the union, the labor group could advocate for changes like higher pay, but would not challenge the drivers’ classification as independent contractors.

Uber has also been in talks with labor groups in New York about developing a state law that would create a form of collective bargaining for gig workers without making them employees, and a draft of the legislation started circulating last week.

In its home state of California, Uber and other platform companies tried, unsuccessfully, to reach a deal with unions that would exempt them from the state’s new rule requiring employment rights for some workers. After those talks failed, the companies secured an exemption via a $200 million ballot measure campaign instead.