"The employment tribunal was right to find that Uber drivers are workers who therefore qualify for the rights conferred on workers by employment legislation", said judge George Leggatt, as he read out a summary of the ruling on a court livestream.
The ruling will have a significant impact on the UK's estimated 4.7 million gig economy workers, affecting not just tech giants like Uber and food delivery firm Deliveroo, but also less well known companies like couriers CitySprint and plumbing outfit Pimlico Plumbers.
"Drivers are in a position of subordination and dependency to Uber, such that they have little to no ability to improve their economic position or professional or entrepreneurial skill".
An employment tribunal ruled in 2016 that Uber drivers were workers, and were entitled to workers' rights.
It is the latest in a series of cases where judges have found that, despite Uber's claims to the contrary, its drivers are not self-employed entrepreneurs.
But voters in November then backed Proposition 22, a measure designed by Uber and other gig companies that would mean drivers remained independent contractors while receiving some benefits.
Uber takes active steps to prevent drivers and passengers from having an agreement outside of the Uber app.
Being classified as employees would have entitled workers to a minimum wage and benefits like sick leave and unemployment insurance.
That ruling was upheld by an employment appeal tribunal, and by Court of Appeal judges.
Leigh Day, the law firm fighting the case on behalf of the GMB Union, said tens of thousands of drivers could be entitled to an average of £12,000 in compensation.
Then in 2018, the Court of Appeal judgement became Uber's third legal defeat on this issue.
Uber says that it has changed the way it works since the legal action began. "Neither will be appealing, at a time when their balance sheets have been hit hard by the pandemic", she said. "It will shape all future cases concerning the gig economy".
The decision potentially threatens Uber's business model in the United Kingdom, one of its biggest markets.
The ruling could equally affect the online platforms behind the so-called gig economy in Britain - people doing short-term work without formal contracts, or working without guaranteed hours.
"Today's judgment is a crucial milestone in the protection of individuals in our modern economy".
"The Supreme Court has upheld the decision of three previous courts, backing up what GMB has said all along; Uber drivers are workers and entitled to breaks, holiday pay and minimum wage".