Uber drivers are to receive millions of pounds of pension payments dating back to 2017 as part of an agreement made with the UK pensions regulator.
The deal follows a Supreme Court ruling in February this year which found the ride hailing group’s private hire drivers should be classed as workers, rather than self-employed contractors, giving them rights to minimum hourly pay, holiday pay and a pension.
Under the scheme, run by Now: Pensions and Adecco, Uber drivers will be auto-enrolled with Uber contributing 3% of earnings and drivers able to choose to contribute a minimum of 5% of their qualifying earnings.They can also choose to opt out of the scheme. Uber drivers will also receive back payments dating back to 1 May 2017 or the date they started driving for the company, if that is later. However, the scheme will not be extended to workers who drive for its food delivery service, Uber Eats.
Uber worked with the UK’s pensions regulator to create the scheme, which is the first of its kind for flexible private hire drivers.The company has called on all gig economy companies to recognise the employment rights of those who work for them and follow them in setting up workplace pensions.
Jamie Heywood, regional general manager for northern and eastern Europe, Uber, said drivers should be able to access a pension “no matter who they earn with”, adding: “Today I am extending an invitation to work with operators such as Bolt, Addison Lee and Ola to create a cross-industry pension scheme.”
GMB Union added its voice to Uber’s call for other taxi operators such as Bold, Addison Lee and Ola to create a cross-industry scheme to enable drivers to save for retirement regardless of which platform they work for.
The pension scheme is the latest benefit awarded to Uber’s drivers. In March, Uber agreed to give its drivers a guaranteed minimum wage and employment rights such as holiday and sick pay, following the Supreme Court ruling. This was followed in May by the company agreeing to recognise a union for the first time, allowing drivers to become GMB members.
Alex Fleming, regional president of Northern Europe, Adecco, said: “As the UK labour market continues to be redefined as a result of the global pandemic, the need for equitable treatment and greater security is integral to building back better and supporting flexible workers. This is an industry first that not only paves the way in improving workers’ rights and protections, but also contributes to sustainable futures for drivers.”
Stephen Timms MP, chair of the Work and Pensions Select Committee, claimed the scheme was an opportunity to extend pension rights to a large cohort of workers. He added: “I also welcome Uber’s call for a cross-sector approach to pension saving. The all-party Work and Pensions Select Committee has called on ministers for a timetable for its promised Employment Bill, to improve protections for all gig-economy workers.”
Mick Rix, national officer of the GMB union hailed Uber’s pension scheme as a “massive step in the right direction” helping thousands of drivers as they reach retirement age and urged other platform-based operators “to follow Uber’s lead.”
However some drivers believe Uber’s pension scheme is not enough. James Farrer, general secretary of the ADCU union, said: “Uber’s 3% pension contribution is welcome but it falls far short of what drivers deserve. Poor pay and Uber’s failure to pay waiting time continue to be a huge source of discontent for the workforce, which is why the ADCU is staging a 24-hour Uber driver strike across eight UK cities on 28 September.”