Uber has lost its appeal against an $81 million payroll tax bill in New South Wales after Australia’s High Court ruled that payments made to drivers should be treated as wages.
The decision brings to an end a legal dispute over fares collected between the 2015 and 2020 financial years. Uber had argued that it acted as a payment collection agent and did not pay wages to drivers.
The court found that Uber’s contracts created a legal obligation for drivers to transport passengers once they accepted a request. As a result, payments made for completed journeys were deemed to be wages under the relevant law.
One of the High Court’s seven justices dissented from the ruling.
Uber payroll tax ruling could affect gig economy
The case had previously gone in Uber’s favour at the New South Wales Supreme Court, which ruled in 2024 that the company collected payments on behalf of its driver partners rather than paying them wages.
That decision was overturned by the New South Wales Court of Appeal last year, prompting Uber to take the matter to the High Court.
The ruling could have wider implications for Uber and the gig economy, with the decision potentially setting a precedent for hundreds of millions of other transactions if applied across longer periods and in other Australian states.
The company had been so confident of succeeding that it made no provision for the potential 81.5 million Australian dollar liability when it lodged its financial results with the regulator earlier this year.
Uber has consistently maintained that its drivers are contractors rather than employees, and that it is a platform matching contractors with passengers rather than a transport provider. It has relied on that position in disputes involving driver misconduct, minimum wages and possible discrimination complaints.
