Uber must classify its drivers in Amsterdam as employees rather than contractors, a Dutch court ruled Monday, in a blow to the ride-hailing company’s gig-economy business model.
The news follows a similar decision earlier this year in the UK, in which the nation’s supreme court gave more than 70,000 Uber drivers access to a minimum wage, pension plan and paid vacation, among other benefits.
Now, Amsterdam’s District Court says Uber will be required to extend similar benefits to the company’s 4,000 drivers in the city after siding with the Federation of Dutch Trade Unions. The court found that Uber drivers are in fact employees of a taxi company and should therefore receive the same benefits as other taxi drivers, who are covered by a sectorwide bargaining agreement.
Uber must also pay a $59,000 fine and may in some cases have to give drivers back pay, the court ruled.
The ride-hailing company said that it planned to appeal the decision and “has no plans to employ drivers in the Netherlands.”
“We are disappointed with this decision because we know that the overwhelming majority of drivers wish to remain independent,” said Maurits Schönfeld, Uber’s general manager for northern Europe. “Drivers don’t want to give up their freedom to choose if, when and where to work.”
Meanwhile, a spokesperson for the Federation of Dutch Trade Unions praised the decision.
“Due to the judge’s ruling, the Uber drivers are now automatically employed by Uber,” said Zakaria Boufangacha, FNV’s deputy chairman. “As a result, they will receive more wages and more rights in the event of dismissal or illness.”
In the US and most other markets, Uber classifies its drivers as contractors rather than employees, allowing the unprofitable company to avoid paying out a minimum wage or sick days.
In 2020, Uber, Lyft, Instacrat and other contractor-based apps spent a reported $200 million in a push to enshrine their right to use contract labor into California law though a ballot measure called Proposition 22.
The measure passed — but was overturned in August by a judge who called the rule unconstitutional. Uber has said it planned to appeal that ruling as well.
New York Post