In 2016 a tribunal ruled drivers James Farrar and Yaseen Aslam were Uber staff and entitled to holiday pay, paid rest breaks and the minimum wage.
That ruling has now been upheld by the Court of Appeal.
But Uber pointed out that one of the three judges backed its case and said it would appeal to the Supreme Court.
Mr Farrar, who is chairman of the United Private Hire Drivers branch of the IWGB union, said: "I am delighted today's ruling brings us closer to the ending Uber's abuse of precarious workers made possible by tactics of contract trickery, psychological manipulation and old-fashioned bullying."
He added that he was dismayed that implementation of worker status for drivers was being further delayed while Uber seeks yet another appeal.
Uber
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