Uber South Africa Faces Class-action Lawsuit

A 100% black owned law firm with a collective knowledge and experience of 20 years in various fields of law including public interest law, civil litigation and family law, Mbuyisa Moleele Attorneys, assisted by Leigh Day, are preparing a class action lawsuit to be filed in the Johannesburg Labour Court against Uber South Africa on behalf of South African Uber drivers.

The claim is based on the drivers’ entitlement to rights as employees under South African legislation and will seek compensation for unpaid overtime and holiday pay. This case follows a decision by the UK Supreme Court that Uber drivers should be legally classified as workers rather than independent contractors. As such they are entitled to similar benefits.

Leigh Day represented the UK Uber drivers in the case in which the lower courts, including the English Court of Appeal, also ruled in favour of the drivers. Mbuyisa Moleele Attorneys said South African legislation relating to employment status and rights is very similar to UK employment law.

“Furthermore, Uber operates a similar system in South Africa, with drivers using an app, which the UK Supreme Court concluded resulted in drivers’ work being ‘tightly defined and controlled’ by Uber,” said Zanele Mbuyisa of Mbuyisa Moleele Attorneys.

In the UK case, the key issue was whether drivers contract with passengers using Uber as an agent, or alternatively that drivers are working for Uber. The conclusion of the Supreme Court was that they work for Uber. Even though Uber’s lawyers gave the impression that Uber were merely agents, the Court ruled that the true position was that Uber has control over the way in which drivers deliver their services.

Through the app, Uber sets the amount of the fare, the level of information given to the driver about the passenger and their destination. Uber also monitors drivers’ performance and deactivates drivers who do not conform to Uber’s standards. The company has lost or settled similar labour law cases in France, Switzerland, Ontario and North Carolina.

The UK Supreme Court found that the contractual terms on which drivers perform their services are dictated by Uber. The Court noted that while the system of control operated by Uber was in its commercial interests, it clearly placed drivers in a position of subordination and dependency in relation to the company.

Uber in South Africa

Uber South Africa operates in Johannesburg, Cape Town, Durban, Pretoria, Port Elizabeth and East London. In 2018 it was estimated that Uber controlled 75% of the South African taxi market. As the largest ride-hailing service in the world, Uber has a market capitalisation of around $102 billion, and its “Mobility” (Uber X) business reported operating income of US$293 million in 2020.

Due to South Africa’s income disparity, few professional drivers actually own the cars that they drive. Instead, they rent them from owners, known as “partners” and split the earnings. Key to Uber’s defence in the UK case was that it is merely a technology company acting as a booking agent for drivers, and not an employer.

However, in its own submissions to the 2020 SA Competition Commission Inquiry into metered taxis and e-hailing services, Uber said its local operations were different from countries like the United States.

Uber said drivers in South Africa tend to be predominantly full-time on the Uber platform and their work for Uber is equivalent to fulltime employment, and not just a way of earning supplementary income.

This, along with the fact that the Competition Commission found that after deductions, some drivers earn less than the minimum wage, means that Uber drivers in South Africa work incredibly long hours just to make ends meet.

The Supreme Court recognised similar difficulties faced by drivers in the UK case by stating that in practice, the only way in which drivers could increase their earnings was by working longer hours while constantly meeting Uber’s measures of performance.

Estimates suggest that there are between 12,000 to 20,000 drivers in South Africa using the Uber app who will be covered by the lawsuit. The lawsuit is an opt-out class action in which a small number of representative plaintiffs are claiming on behalf of the wider class of Uber drivers.