Dutch Court Rules Uber Drivers as Employees

Uber Faces Employment Ruling in the Netherlands

Uber has encountered another setback in Europe regarding the classification of its drivers. The Amsterdam Court in the Netherlands has determined that drivers operating through the Uber platform are legally considered employees, not independent contractors.

This ruling extends coverage to an existing collective labor agreement for taxi drivers within the country. Consequently, Uber will incur increased operational costs to ensure compliance with the agreement’s stipulations, including mandated pay scales and benefits such as sick leave. Potential retroactive compensation to drivers is also a possibility.

The court has also mandated Uber to cover legal costs amounting to €50,000.

Impact on Dutch Operations

Approximately 4,000 drivers currently utilize Uber’s platform within the Dutch capital city.

The Amsterdam court dismissed Uber’s standard argument that it functions solely as a technological intermediary connecting passengers with transportation services. Instead, the court found that drivers are effectively self-employed only in name.

Judges emphasized the nature of the services provided by the drivers and the degree of control Uber exercises over their work conditions and earnings through its application and algorithmic systems.

Echoes of Previous Rulings

This decision mirrors a 2017 ruling by Europe’s highest court, which classified Uber as a transportation provider subject to local transport regulations.

The legal challenge in the Netherlands was initiated by the FNV, the national trade union center, last year, with hearings commencing in late June.

FNV’s Response

Zakaria Boufangacha, VP of the FNV, stated: “This ruling validates our long-held position: Uber functions as an employer, and its drivers are employees. Therefore, Uber must adhere to the collective labor agreement for Taxi Transport.”

He further added that the outcome signals to authorities that such contractual arrangements are unlawful and require legal enforcement.

Uber’s Reaction and Appeal

Uber has been contacted for comment. Initially, the company did not respond, but Reuters reported that Uber intends to file an appeal and maintains it has no plans to directly employ drivers in the Netherlands.

Update: Uber has officially confirmed its intention to appeal the court’s decision. A spokesperson stated that the ruling will not immediately affect drivers using the app during the appeal process.

Maurits Schönfeld, Uber’s general manager for Northern Europe, expressed disappointment, stating: “We believe the vast majority of drivers prefer to remain independent, valuing the flexibility to choose when, where, and if they work.”

He added that Uber will appeal the decision to protect driver independence and simultaneously work to enhance platform work conditions in the Netherlands.

Similar Cases in the U.K.

Uber has previously faced and lost a series of employment classification tribunal rulings in the U.K., culminating in a defeat before the U.K. Supreme Court in February.

Following this, Uber announced it would classify its U.K. drivers as workers, though disagreements persist regarding the definition of working hours. In May, Uber also agreed to recognize a U.K. trade union for the first time.

Ongoing Legal Battles Across Europe

Despite these developments, Uber continues to contest employment lawsuits in other European countries and actively lobbies EU lawmakers to deregulate platform work.

EU’s Approach to Platform Work

The EU has expressed a desire to improve conditions for platform workers, but the specifics of any potential pan-EU reforms remain unclear.

The European Commission is currently seeking input on its platform work initiative.

Concerns About Lobbying and Corporate Influence

Jill Toh, a PhD researcher at the University of Amsterdam, commented: “Digital labour platforms are understandably concerned, as evidenced by their substantial investments in lobbying efforts and increased resource allocation at the EU level.”

She noted that companies like Uber have formed a new funding lobby group specifically aimed at influencing policies related to platform work.

“We observed Uber’s successful manipulation of laws during the Prop 22 campaign in California, and they are attempting a similar strategy in Europe,” Toh added. “It’s concerning that the Commission’s consultations have primarily involved tech companies, excluding trade unions and other platform work representatives.”

“This situation is deeply problematic, particularly if the EC consultations lead to a directive on platform work. While court victories are important for workers, the issue of corporate power and influence in Brussels, along with the lack of public enforcement of court decisions, remains a significant challenge.”

Commission Update

Update: A Commission spokesperson informed us that the second-stage consultation on improving working conditions for platform workers is still in progress (deadline: September 15th).

“The Commission intends to present a proposal by the end of the year, based on the consultation’s outcome,” the spokesperson stated.

“The goal of this consultation is to gather feedback from social partners on how to ensure decent working conditions for platform workers while supporting the sustainable growth of digital labour platforms in the EU. This includes exploring potential solutions for employment status classification and access to labour and social protection rights.”

The spokesperson also confirmed that the Commission is closely monitoring developments in Member States and incorporating them into its analysis.