Regulating Ridesourcing Companies and the Employment Status of Drivers in the Sharing Economy : A Study on Uber

Abstract

Sharing Economy is a growing market and it contains many types of companies. Ridesourcing companies are platform-based companies, which provide an intermediator service connecting the drivers and the passengers. However, some scholars, governments and local taxi unions do not totally agree with this definition and claim that ridesourcing companies are de facto also providing the underlying transport service. The most famous ridesourcing company Uber was founded in the United States in 2009 and it expanded to Europe in 2011. Several other companies have followed in Uber’s steps, but the definition of the nature of their operations has not yet been clarified on the European Union level. Many Member States have banned the operations of ridesourcing companies and there is legislation regarding them for example in France. Some Member States, however, determine ridesourcing companies as digital services and allow their operations. Due to the unclear situation, three preliminary ruling requests have been submitted to the European Court of Justice regarding the definition of Uber. The Spanish and the French request are still pending. Hopefully, the decisions will determine whether Uber is a digital or a transport service provider. The employment status of the drivers of ridesourcing companies is not clear either. The companies deny having an employment relationship with the drivers and instead classify them as partners or clients and as self-employed transport service providers. Many cases have emerged globally where the drivers are trying to receive the employee status and the benefits which come with it. This thesis will present a case of the UK Employment Tribunal which determines first the nature of Uber’s operations and then the employment status of the drivers. That case will be compared with the two cases of Helsinki Court of Appeal where Uber drivers sentenced for providing an unlicensed taxi service. This thesis will argue that the definition of Uber was the difference which led to opposite decisions about the employment status of the drivers. Comparing the UK and the Finnish employment law and case law regarding Uber drivers show how fragmented the situation is in EU