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Contract and Employment Law

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CONTRACT AND EMPLOYMENT LAW 2

Employment Contracts

An employment contract is a legally binding agreement between an individual with their

employers. It seeks to establish both the rights and responsibilities accrued to contract parties.

Local businesses, like Uber, should carefully draft a contract that will serve both the company

and its employees to reap the benefits equally. This calls for careful consideration in contract

drafting to meet the basic elements of a contract. These crucial elements are discussed below;

           The first element is contract position. This clearly states employee job requirements that

include the position’s name, working place and working hours. The second element is contract

length. It dictates the term of employment with conditions required by both parties to extend,

decrease or terminate the agreement term. The third element is contract expectations and

requirements. It spell out skills to upgrade during employment. Uber expects its employees to log

in the driver’s app for certain hours to attain the recommended number of jobs. The fourth

element is compensation and its calculation. It spell out payment method in place and any

incentive program objectives (Bester, 2018).

Uber pays its employees £8 to £12 daily depending on hours worked (BBC News, 2016).

Lastly, benefits and premiums element define any benefits package given to an employee. Any

benefits premium paid by an employee should also be clear. Uber has been treating its workers

as self-employed, a concept that was denied by the London tribunal. The rule was in favor of

Uber’s employees to be treated as “employees” to enjoy rights that come along with the tag.

Important Terms, Conditions, and Warranties

           It is crucial to include other covenants in the contract to ensure the smooth running of the

business. Booking services, as laid down in Uber UK terms and conditions handbook, spells out

identification of suitable transportation providers and keeping of bookings track records as well
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as managing lost property. Under this, Uber UK accepts any liability concerning booking

services only. Termination language must also be included in a staff handbook. Uber reserves

powers to terminate its employee’s contract if they deem the employees do not follow their terms

and conditions. Other covenants include non-recruit agreement and property rights inclusion

(Uber Legal Team, 2020). 

           Warranties should also be included in the contract. An employment contract should state a

warrant for employees not to breach any contractual obligation. It should require a worker to

give an indemnity concerning any loss incurred because of a breach of the contract. In addition, a

contract should require workers to warrant their professional employment. These include

qualifications for specific jobs and notification in the event they cease to hold that qualification. 

Employment Status Determination

           Determination of employment status is not based on contract stipulation, but its

underlying facts of work engagement. The first test is the mutuality of obligation. One party

should provide an obligation to work while the other party obliges to provide work. Uber drivers

claimed to the tribunal of their obligation to provide services in person. The court ruled that there

was no express contractual terms to allow the drivers to claim these obligations. In this case, the

drivers were labelled self-employed.

Control Test is the second employment status test. It determines a party’s control over

another. If an individual is under control of an employer during work and off work period, they

are employees (BBC News, 2016). In the Uber Case, the court decided that the contract between

Uber and its drivers had little resemblance to the way they carry their operations. The tribunal

looked more on reality of their working relationship instead of the contract. Uber claimed their
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employees operate their own businesses, a notion disregarded by court who held the level of

control exercised by Uber over their drivers is incompatible with self-employed status.

Lastly, mixed test is used to determine aspect of “contract of service” to qualify a person

to be an employee. In the Uber case, the court deduced that Uber have sufficient control when

Uber’s app is switched on. Uber had direct control over their drivers by controlling how they

work hence a contract service establishment. This decision do provide guidance on employee

status. This calls for tribunals to have a realistic approach in determining a true employment

position.

           In conclusion, companies should work towards the creation of a healthier environment

that works for all. Employments contract elements needs to be a prioritized to ensure

employment rules are upheld to reflect better working ways. It should be able to protect

employees’ job security while minimizing risks accrued to the employer. 

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References

BBC News. (2016). Drivers battle Uber over employment rights.

https://www.bbc.com/news/business-36843386

Bester, C. (2018). Elements of a basic permanent employment contract. Stockfarm, 8(8), 71-71.

https://journals.co.za/content/journal/10520/EJC-ff045fd23

Uber Legal Team. (2020). Terms and Conditions. https://www.uber.com/legal/en/document/?

name=general-terms-of-use&country=great-britain&lang=en-gb