Drivers who provide rides and deliver online orders via Uber Technologies Inc.’s apps are legally considered workers, the U.K.’s Supreme Court said in a landmark ruling today.

The ruling holds potentially major implications for Uber, as well as other tech companies such as Lyft Inc. that have similar business models. 

Uber currently classifies drivers in the U.K. as independent contractors. In 2016, the company was sued by a group of 25 drivers who argued they should not be considered independent contractors but rather workers and therefore entitled to employment rights. It’s that 2016 case on which the U.K.’s Supreme Court ruled today. 

The judges unanimously found that Uber drivers should be indeed be classified as workers and receive rights such as minimum wage, holiday pay and rest breaks.

The case will now go before a specialty tribunal to determine how much compensation Uber must provide to the 25 drivers who filed the lawsuit. The ruling potentially also clears the way for about 1,000 similar claims against the company that had been stayed until after the ruling.

According to a Bloomberg report from this morning, a law firm that worked on the original 2016 suit plans to seek compensation for “thousands” of drivers. The law firm is said to estimate that Uber owes each driver an average of 12,000 pounds, or about $16,700.

On top of the potential financial claims it may face in court, Uber could see its operating expenses increase following the ruling. Providing the additional rights to which drivers are now entitled could hurt the company’s profit margins.

“We respect the Court’s decision which focused on a small number of drivers who used the Uber app in 2016,” Jamie Heywood, Uber’s regional general manager for Northern and Eastern Europe, told CNBC in a statement. “Since then we have made some significant changes to our business, guided by drivers every step of the way. These include giving even more control over how they earn and providing new protections like free insurance in case of sickness or injury.”

The ruling is particularly significant because the U.K. is one of Uber’s largest markets outside the U.S. As of 2019, the company reportedly had about 3.5 million regular passengers in London alone. Today’s court decision will likely also be important for the broader U.K. tech industry because it could affect other transportation and food delivery app providers besides Uber that have been classifying their drivers as contractors. 

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