Former Uber Eats courier paid $400,000 in out-of-court settlement

16th Sep 2021

Is an Uber Eats courier an employee or an independent contractor? 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 that she had failed to meet delivery time standards, Uber Eats courier Amita Gupta had her access to the Uber Eats app cut off. With the support of the Transport Workers’ Union (the Union), Ms Gupta brought an unfair dismissal case against Uber.

The Fair Work Commission (the Commission) dismissed Ms Gupta’s application. In 2020, the Union lodged an appeal on her behalf.

In Amita Gupta v Portier Pacific Pty Ltd; Uber Australia Pty Ltd t/a Uber Eats, the Full Bench of the Fair Work Commission held that Ms Gupta was not an employee of Uber and that she was not covered by the unfair dismissal laws in the Fair Work Act 2009 (Cth).

Uber Eats courier not conducting her own business

This was an unusual decision by the Commission. The Full Bench held that Ms Gupta was not in a business relationship with Uber however found that she did work for the business.

The Commission rejected Uber’s argument that its couriers were conducting their own businesses, and that Uber was only an agent for the restaurants in arranging delivery.

The Commission stated that Uber Eats set couriers’ pay, banned them from delegating work and hindered them from making their own agreements with restaurants for delivering meals. Further, the Commission found that Uber maintained complete control over payment for each courier’s work and enforced standards of delivery through a rating system.

Lack of the essential hallmarks of an employment relationship

On the other hand, the Commission stated 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 Uber Eats couriers lacked some of what it deemed were ‘the essential hallmarks of an employment relationship’ (at [70]).

The Full Bench pointed out that an Uber Eats courier could log on and off the app at will, could also work for other food delivery outlets, and could decide whether or not to accept deliveries. The couriers did not have to wear a uniform or display a company logo and were responsible for their own vehicles.

Another consideration was that Uber 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 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 succeeded, it could have set a legal precedent that couriers are employees rather than contractors. This potential outcome would threaten Uber’s current business model by providing gig economy workers with entitlements to a minimum wage, annual leave and unfair dismissal protections.

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 is wise to consult a lawyer experienced in employment law.

This is an edited version of an article first published on Stacks Law.

Emily Wittig is a lawyer at Stacks Collins Thompson in Hornsby with over two years’ post-admission experience. She has a particular focus on employment law, having spent over two years prior to her admission working in employment relations, in both federal and state jurisdictions. She previously worked as a Fair Work inspector for the Fair Work Ombudsman, and as an employment relations adviser for the Motor Traders Association of NSW. Emily volunteers as a solicitor at a community legal centre and enjoys helping people who have been taken for granted by their employer.

The views and opinions expressed in these articles are the authors' and do not necessarily represent the views and opinions of the Australian Lawyers Alliance (ALA).

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Tags: Workers' rights Employment gig economy Fair Work Commission