Stories
Slash Boxes
Comments

SoylentNews is people

posted by martyb on Friday November 15 2019, @09:20PM   Printer-friendly
from the get-to-refile-four-years-of-state-and-federal-taxes,-too dept.

Arthur T Knackerbracket has found the following story:

New Jersey is the latest state to say Uber's drivers should be classified as employees rather than independent contractors. The state's labor department said that because of this misclassification, the ride-hailing company owes it roughly $650 million in unemployment taxes and disability insurance, according to Bloomberg Law.

The labor department reportedly has been trying to get unpaid employment taxes from Uber going back as far as 2015, according to documents obtained by Bloomberg Law. It said the company owed the state $523 million in overdue taxes along with another $119 million in interest and penalties for the last four years. Uber disputes these findings.

"We are challenging this preliminary but incorrect determination," an Uber spokesman said in an email. "Because drivers are independent contractors in New Jersey and elsewhere."

Driver classification is an issue that government regulators have been taking a closer look at over the past year. California passed a law in September that could require Uber and other on-demand companies to reclassify their drivers as employees instead of independent contractors. The law is set to go into effect Jan. 1. New York, Oregon and Washington state have considered similar legislation.


Original Submission

 
This discussion has been archived. No new comments can be posted.
Display Options Threshold/Breakthrough Mark All as Read Mark All as Unread
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.
  • (Score: 3, Insightful) by darkfeline on Friday November 15 2019, @11:16PM (12 children)

    by darkfeline (1030) on Friday November 15 2019, @11:16PM (#920831) Homepage

    But that's wrong. Contracting company C hires you. Other company B contracts C for work, so you do work that is ultimately for B. Why should B have to pay taxes for you? Why should the government get double taxes for contractors, paid by both B and C? If paying taxes is too expensive for C, then they should be passing that on to B as part of the payment for the contract.

    --
    Join the SDF Public Access UNIX System today!
    Starting Score:    1  point
    Moderation   +1  
       Troll=1, Insightful=1, Underrated=1, Total=3
    Extra 'Insightful' Modifier   0  
    Karma-Bonus Modifier   +1  

    Total Score:   3  
  • (Score: 2) by Immerman on Saturday November 16 2019, @01:12AM (10 children)

    by Immerman (3985) on Saturday November 16 2019, @01:12AM (#920849)

    Why would B be paying taxes for you? C pays you - they're your employer, and they pay taxes for you. Those cost of those taxes will obviously be passed on to B, but B is not your employer. They don't pay *you* anything, so why would they be on the hook to pay for your taxes?

    Really, you've just described almost every job in the world. You want a hamburger, but don't want to cook it yourself and clean the kitchen, so you go to McDonalds and pay for someone else to do the cooking and cleanup. But you're not paying them directly, so you don't pay their taxes - you're paying the franchise for goods and services, and the franchise pays their employees to provide them.

    Which is exactly what's happening with Uber. Passengers pay for you to give them a ride - but they don't pay *you*, and so they are not your employer, Uber is.

    • (Score: 5, Interesting) by edIII on Saturday November 16 2019, @02:03AM (9 children)

      by edIII (791) on Saturday November 16 2019, @02:03AM (#920853)

      Which is exactly what's happening with Uber. Passengers pay for you to give them a ride - but they don't pay *you*, and so they are not your employer, Uber is.

      Not precisely. It is possible for Uber to accept the money and not be the employer, but then they would actually have to become what they say they really are, which is a SaaS provider.

      Uber claims to be providing all of the tools. Management, CRM, Billing, Marketing, Customer Support, and Sales are all things an independent contractor would want when running a sole proprietor business. The "employee" is a cab company of one, and therefore truly separate from Uber.

      Except Uber dictates all of the costs and pricing. That is the crucial difference where they're Saas argument completely falls apart. What independent contractor would allow pricing to be dictated by a 3rd party vendor of anything?

      Uber needs to accept that if it doesn't want employees, it's going to need to become more like VISA. Uber becomes just a payment processor charging a percentage, and the independent contractor gets full control over pricing.

      --
      Technically, lunchtime is at any moment. It's just a wave function.
      • (Score: 2) by Runaway1956 on Saturday November 16 2019, @02:40AM (4 children)

        by Runaway1956 (2926) Subscriber Badge on Saturday November 16 2019, @02:40AM (#920858) Journal

        I think that's the key, edIII. As a contractor, I could always decide for myself exactly what to charge, for each and every job. That price is negotiated with the customer. If some third party decides for me what the price will be, then I'm no longer an independent contractor. I think that maybe Uber looked at the world of truck driving, saw how the corporates are taking advantage of people who want to own their own trucks, and tried to take advantage of all those loopholes. Government needs to take a look at how that whole can of worms works, and make some changes.

        As a contractor, the Uber driver who picks up a well heeled customer at LAX should be able to set his price based on his judgement that the potential customer can afford and is willing to pay ten dollars per mile. Or twenty, or fifty dollars per mile. As long as Uber is setting the price, he's not independent at all.

        • (Score: 1) by khallow on Saturday November 16 2019, @02:57AM (3 children)

          by khallow (3766) Subscriber Badge on Saturday November 16 2019, @02:57AM (#920863) Journal

          If some third party decides for me what the price will be

          Like a head hunter? In the case of Uber, the driver still has the power to reject what Uber offers.

          As a contractor, the Uber driver who picks up a well heeled customer at LAX should be able to set his price based on his judgement that the potential customer can afford and is willing to pay ten dollars per mile.

          Why?

          • (Score: 2) by Runaway1956 on Saturday November 16 2019, @03:12AM (2 children)

            by Runaway1956 (2926) Subscriber Badge on Saturday November 16 2019, @03:12AM (#920870) Journal

            the driver still has the power to reject what Uber offers.

            As employees, we all have the power to reject what the boss offers. The moment we lose that power, then we are no longer employees, but slaves. Perhaps you would like to try again with a real point?

            • (Score: 1) by khallow on Saturday November 16 2019, @04:20PM (1 child)

              by khallow (3766) Subscriber Badge on Saturday November 16 2019, @04:20PM (#920992) Journal

              As employees, we all have the power to reject what the boss offers.

              Or contractors.

              • (Score: 2) by Immerman on Sunday November 17 2019, @05:08PM

                by Immerman (3985) on Sunday November 17 2019, @05:08PM (#921268)

                Their point, I think, is that being able to reject the offer is not relevant to the discussion of whether you are a contractor or an employee.

      • (Score: 5, Interesting) by JoeMerchant on Saturday November 16 2019, @03:26AM (3 children)

        by JoeMerchant (3937) on Saturday November 16 2019, @03:26AM (#920874)

        To me, there needs to be a duck test:

        1) Does the "contractor" get the majority of their pay from a single payer, year after year? If so, that's not a contractor.

        2) Does the payer have a large number of "contractors" whose work is ongoing, no particular completion of a job just job after job after job after job? If so, those are not contractors.

        Employees can be part time, temporary, start on short notice and quit on short notice, day labor... Calling them people contractors as a way to reduce responsibility as an employer is disingenuous - whether employee or contractor, the needs of the laborer are the same - whatever labor laws have been written for employees should also be applied to contractors.

        You can split hairs about who pays the income tax - yes, that should only happen once per labor-payment event, where the insurance coverage comes from - whether employee or "contractor" the needs for insurance are the same, payment of overtime - as a part-time employee for two separate employers I was working 70+ hours some weeks without overtime pay, but in the end labor is labor regardless of how the paperwork is structured.

        --
        🌻🌻 [google.com]
        • (Score: 1, Informative) by Anonymous Coward on Saturday November 16 2019, @09:00AM

          by Anonymous Coward on Saturday November 16 2019, @09:00AM (#920933)

          Why yes, there should be a duck test. In fact, there is [irs.gov].

          1) Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
          2) Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
          3) Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?

          You can find more details on each at the IRS website, but on the surface, it seems like it's a pretty good test to me. I think the argument is that Uber passes/fails that duck test, depending on who is arguing what.

          Unless you are arguing that the current test is bad for some reason, in which case can you please elaborate on which component(s) of the current test are inappropriate and why?

        • (Score: 2) by edIII on Saturday November 16 2019, @11:11PM (1 child)

          by edIII (791) on Saturday November 16 2019, @11:11PM (#921102)

          1) Does the "contractor" get the majority of their pay from a single payer, year after year? If so, that's not a contractor.

          As long as you restrict that to the end user, or customer. Uber, when operating correctly, isn't a payer, but an intermediary between customer and contractor. No different than Stripe, Freshbooks, Quickbooks, any many other online platforms that handle customer interactions and payments. You wouldn't claim that somebody that accepted AMEX only is in fact an AMEX employee right?

          Which brings up another issue, there is also Lyft involved in this discussion. It's not any real difference to me if a allegedly independent contractor is being hosed by both Uber and Lyft at the same time. Many people have two jobs, so that test doesn't catch that.

          The test needs to concentrate on the levels of control over the transaction, who gets authority over invoicing, setting the price, .etc. I've been in the situation as an independent contractor where I had only one big client left, and I sure as heck didn't feel like an employee to them, nor did they see that relationship either (not that they knew how many clients I had). Especially since I set the price of my contract and they agreed.

          Not all independent contractors are being abused. Uber if operating correctly would actually be a pretty neat vendor for an independent driver to have.

          --
          Technically, lunchtime is at any moment. It's just a wave function.
          • (Score: 2) by JoeMerchant on Saturday November 16 2019, @11:36PM

            by JoeMerchant (3937) on Saturday November 16 2019, @11:36PM (#921114)

            who gets authority over invoicing, setting the price, .etc

            Very good points, and clearly distinctive - if you are representing products from a catalog, taking a fixed commission (as my wife did for several years), calling her an "independent consultant" is just insulting.

            --
            🌻🌻 [google.com]
  • (Score: 2) by JoeMerchant on Sunday November 17 2019, @02:21AM

    by JoeMerchant (3937) on Sunday November 17 2019, @02:21AM (#921148)

    I've done this gig - Company A payed Company B $11 per hour for employees. I was paid by Company B, $6 per hour. What did Company B do for me, above and beyond the $6 per hour? Nothing. They relieved Company A of some HR overhead, that's it.

    --
    🌻🌻 [google.com]