Uber suspends services in Switzerland, after the highest court in the country determined that they are employers

The Swiss Federal Court upheld the ruling that the US ride-sharing company should be treated as an employer, rejecting Uber’s attempt to overturn the verdict of a Geneva court.

With this determination, Uber’s appeal against this verdict, which had already begun to take shape in 2019, but which did not come to fruition for the accused company, was dismissed.

Historic decision: Uber is an employer and not an intermediary between drivers and passengers, according to Swiss court

The Federal Supreme Court thus dismissed an appeal by Uber Switzerland and the Dutch Uber BV. In his judgment, he asserts that the corresponding decision of the lower court in Geneva was not arbitrary. In November 2020, the cantonal court concluded that the contractual relationship between Uber and the Geneva drivers was based on an employment contract. For this reason, Uber BV must be understood as a transport company that must comply with the Geneva Taxi Law.

“According to the Federal Court, the cantonal court did not rule arbitrarily when it ruled that Uber drivers working in Geneva had an employment relationship with Uber BV. The Federal Chamber dismisses the corresponding appeal”says the statement from the Swiss court.

As a result, Uber has to comply with the provisions on the social protection of employees and compliance with collective agreements in the relevant industry. The employer must also ensure compliance with labor legislation. Uber has drawn the consequences of this and stopped the service on Saturday in the canton of Geneva. The app is disabled.

In another ruling, the Federal Supreme Court dealt with the food delivery service Uber Eats. In this case, Uber Switzerland GmbH filed a complaint that was confirmed by the Federal Supreme Court. The question arose whether Uber Eats is under the Federal Employment Service and the Temporary Employment Law. The lower cantonal courts had affirmed this.

The Supreme Court now reached a different conclusion. It establishes that the leasing of personnel is a tripartite relationship between the lender and, therefore, the employer, the employee and the client company. There are two contractual relationships in this triangle. One regulates the relationship between the lender and the employee, a second is the personal loan contract between the lender and the user company.

Due to the characteristics of the contractual relationship between Uber and the couriers, the Federal Supreme Court assumes an employment relationship. However, there is no staff loan agreement between the restaurants and Uber. In particular, the power to give instructions to couriers is not transferred to catering establishments. In addition, the food deliverers would not be integrated into the organization of the restaurants.

This ruling sets an important precedent. Given the expansion of the shared ride service around the world, the debate has been installed in many countries around the activity of Uber, cataloged as avoiding labor and avoiding collective bargaining with drivers who work on their own.