An employment tribunal in the UK capital on Friday rejected Uber's appeal against an earlier ruling that two drivers were entitled to employee rights such as the minimum wage and holiday pay.

The ride-hailing app had challenged an October 2016 ruling that lead claimants Yaseen Aslam and James Farrer were effectively employees of the US-headquartered firm.

Last year, the two men successfully argued that Uber exerted significant control over them to provide an on-demand taxi service and should grant the same benefits other workers are entitled to.

The app that exploits?

The pair have described Uber's business plan as "brutally exploitative," and have won the support of the Independent Workers of Great Britain (IWGB) trade union.

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Uber had argued that its drivers are independent contractors who operate in the same way as minicabs, or private hire vehicles, and who would lose the "personal flexibility they value" if the suit is successful.

The case is being closely watched by not only the firm's 50,000 other drivers in Britain but the hundreds of thousands of people working in gig economy, who, due to lax labor laws, have little job security and few employment rights, when classed as self-employed.

This type of work has boomed over the past decade with the rise of services offered by internet and smartphone apps, including food deliveries.

'Why are we different?'

Uber said it would appeal this latest ruling. Tom Elvidge, the company's acting general manager in the UK, says that taxi and private hire drivers have been self-employed for decades, "long before our app existed."

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The firm said it made changes to the app to give drivers more control of their work, and offered access to illness and injury cover.

The Reuters news agency said the firm would likely go to the Court of Appeal or straight to the UK's Supreme Court.

The ride-hailing service has faced regulatory and legal setbacks around the world amid opposition from traditional taxi services and concern among some regulators. It has been forced to quit several countries, such as Denmark and Hungary.

Another hurdle

The Silicon Valley firm is due back in the British courts on December 11 to appeal a decision by London's transport regulator to strip the app of its license. Transport for London ruled in September that it is unfit to run a taxi service, citing the firm's approach to reporting serious criminal offences and background checks on drivers.

mm/hg (AFP, AP, Reuters)