Uber (UBER.N) drivers are employees entitled to greater workers’ rights under local labour laws, a Dutch court ruled on Monday, handing a setback to the U.S. company’s European business model.
It was another court victory for unions fighting for better pay and benefits for those employed within the gig economy and followed an identical decision this year about Uber in Britain.
The Amsterdam District Court sided with the Federation of Dutch Trade Unions, which had argued that Uber’s roughly 4,000 drivers within the capital are in reality employees of a taxi company and will be granted benefits in line with the taxi sector.
Uber said it might appeal against the choice and “has no plans to use drivers within the Netherlands”.
“We are disappointed with this decision because we all know that the overwhelming majority of drivers wish to stay independent,” said Maurits Schönfeld, Uber’s head for northern Europe. “Drivers don’t want to offer up their freedom to settle on if, when and where to figure .”
The court found drivers who transport passengers via the Uber app are covered by the collective labour agreement for taxi transportation.
“The legal relationship between Uber and these drivers meets all the characteristics of an employment agreement,” the ruling said.
The FNV hailed the ruling.
“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’re going to receive more wages and more rights within the event of dismissal or illness, for instance .”
Uber drivers are in some cases entitled to back pay, the court said.
The judges also ordered Uber to pay a fine of fifty,000 euros ($58,940) for failing to implement the terms of the labour agreement for taxi drivers.
In March, Uber said it might improve workers’ rights, including the wage, for all of its quite 70,000 British drivers after it lost a Supreme Court case in February.
Uber also faced a legal setback within us , where the Supreme Court in May rejected its bid to avoid a lawsuit over whether drivers are employees and not independent contractors.