Uber faces legal action over Sharia compliant pension arrangements

Uber faces legal action over Sharia compliant pension arrangements

Trade union ADCU has started legal action against Uber for failing to make Sharia compliant pension arrangements for its majority Muslim workforce.

The gig economy workers' union, which represents Uber workers, claimed the company is in breach of Pension Act 1988 and Equality Act of 2010 for excluding Muslim drivers of faith from the company pension scheme. 

The Pension Act of 1998 provides a statutory right for workers not to be subject to any detriment in the pension arrangements.

ADCU said up to 75 per cent of UK Uber drivers are estimated to be Muslims and the failure of Uber to provide a Sharia compliant pension option effectively means that the majority will be forced out of participation in the pension scheme.

Those that do participate are forced to accept a compromise of the tenets of their faith to do so.   

It said action will be to ensure inclusion and access to suitable pension arrangements after Uber failed to respond to its correspondence. 

Yaseen Aslam, president of ADCU and lead claimant in the Aslam v Uber, said: “While Uber’s belated decision, after a decade of operations in the UK, to finally open a pension scheme for their drivers is very welcome, the exclusion of a Sharia option effectively makes the pension scheme inaccessible for the vast majority of the workforce. 

“We’ve tried to resolve the matter quietly with Uber, but we have simply been stonewalled. This is another example of how minority groups by default are forced to struggle for the most basic of rights in the gig economy. The ADCU is determined to contest matters through the courts to make sure Uber makes lawful, fair and inclusive pension arrangements.”

Sharia compliance requires that pension funds should not be invested in companies involved in activities that contravene the tenets of Islam including, for example, the production and sale of alcohol, tobacco, armaments, gambling, pork, and certain financial services. 

The union said Sharia investment screening is comparable to screening for environmental, social and governance ethical funds.

The ADCU is demanding that Uber take corrective action within 14 days.

A spokesperson for Uber said: “We are extremely proud to be the only ride-hailing platform to offer drivers worker benefits including a guaranteed living wage, holiday pay, and pension plan. The vast majority of drivers participate in our current pension scheme and we are working with our partner, Now Pensions, as they create a Sharia-compliant fund which will be available to drivers soon.”

FTAdviser understands that it is anticipated the new scheme will be made available to drivers this summer. 

n September last year, Uber picked Now Pensions as its provider after the High Court ruled in March 2021 that it had to classify its drivers as workers.

Following the decision, Uber said all eligible drivers would be automatically enrolled into a pension plan with contributions from Uber alongside driver contributions.