Providing Uber drivers workers’ rights ‘raises prices and inconveniences consumers’ says think tank

The Institute of Economic Affairs (IEA) has slammed the Supreme Court’s decision to grant Uber drivers workers’ rights, citing the changes will cause raised prices and inconveniences to customers.

The IEA, a UK free-market think-tank founded in 1955, responded to the UK’s Supreme Court ruling which adjudged Uber must classify its drivers as workers rather than self-employed.

The ruling prompted the IEA to suggest young people who use the Uber app platform will now no longer be able to afford a ride or have the money for a conventional cab. It was also argued that availability of Uber vehicles will also be hit, making life for users of the platform more inconvenient.

Following the UK’s highest court judgement, Uber drivers now have the right to earn the minimum wage and holiday pay. Tens of thousands of Uber drivers can now claim the right to be classed as workers.

Professor Len Shackleton, Editorial and Research Fellow at the Institute of Economic Affairs, said: “This judgment will raise costs for Uber users, who are often young people who cannot afford conventional cabs. It will also reduce the availability of rides at the time people want them and squeeze out the large proportion of cab drivers who can only work part-time, as Uber will likely concentrate on a smaller number of workers who can commit to regular hours.

“A ruling which raises prices and inconveniences consumers, while cutting off earning opportunities for many thousands of workers, is hardly the great achievement hailed by the unions. When the logic is extended to other areas of the gig economy, we will see tens of thousands of young people unable to find any work at all at a time when conventional jobs will be very hard to come by.”

The Labour Party however supported the judgement which provides drivers with basic pay. Andy McDonald MP, Labour’s Shadow Employment Rights and Protections Secretary, said: “This is a hugely important ruling with significant implications for the gig economy. Uber drivers and all gig economy workers should get basic rights at work, including decent pay, safety and job security.

“The landmark judgement is also testament to the hard work of the ADCU and GMB trade unions and drivers who have brought about this action.

“Increasing numbers of workers are engaged on exploitative zero hours and insecure contracts. The Supreme Court has sent a very clear message that companies should not game the system by undercutting the rights of their employees.”