Uber agrees to classify drivers in UK as 'workers'

Uber on Tuesday said that it is reclassifying its 70,000 drivers in the United Kingdom as "workers" -- a classification unique to employment law in the UK that falls short of "employee" -- drivers will be entitled to minimum wage, vacation time, and a pension.

This comes after the UK Supreme Court upheld a ruling last month that they should be classified as workers and not independent contractors.

According to CNN, Uber said the minimum wage will be based on engaged time after a trip is accepted and after expenses -- a definition that could be the subject of scrutiny. The apex court determined last month that drivers are working from the time they turn on Uber's app, rather than only when transporting passengers as the company has argued.

The decision marked a significant defeat for Uber in the United Kingdom, where it has come under pressure from labour activists and transportation regulators. The company defended its business model of treating its workers as independent contractors, while, more recently, presenting the addition of new benefits as a sort of middle ground.

"Following last month's UK Supreme Court ruling, we could have continued to dispute drivers' rights to any of these protections in court. Instead, we have decided to turn the page," wrote Uber CEO Dara Khosrowshahi in an op-ed Tuesday published by the Evening Standard discussing the changes, as reported by CNN.

"We have been calling for updates to legal frameworks, both in the US and the EU, that would guarantee benefits and protection for independent workers without removing the flexibility that makes this type of work so attractive to them in the first place," the CEO added.

However, Uber did not apply the changes to its Uber Eats food delivery workers, only ride-hail drivers.

CNN reported that The change to Uber's UK business model follows a decisive win in its home state of California, where voters passed a ballot measure in November exempting Uber and other gig economy compes from a state law that would require them to reclassify their drivers and delivery people as employees rather than independent contractors.

( With inputs from ANI )