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The California Labor Commission has ruled in favor of a former Uber driver in San Francisco, finding that the driver is an employee of the ride-hailing company rather than an independent contractor. The ruling was made earlier but came to light when Uber appealed the decision on Tuesday. Uber could be required to pay the driver $4,152.20 for reimbursement of expenses, but that's only the beginning:
The commission said Uber is "involved in every aspect of the operation." Classifying Uber drivers as employees opens the company up to considerably higher costs, including Social Security, workers' compensation and unemployment insurance. That could affect its valuation, currently above $40 billion, and the valuation of other companies that rely on large networks of individuals to provide rides, clean houses and other services.
Uber had argued that its drivers are independent contractors, not employees, and that it is "nothing more than a neutral technology platform." But the commission said Uber controls the tools driver use, monitors their approval ratings and terminates their access to the system if their ratings fall below 4.6 stars. The ruling affects only California. However, the state is Uber's home base, one of its largest markets, and sets a path often followed by regulators and courts in other states.
Uber did not immediately respond to a request for comment. It likely will not have to start paying any additional costs unless it loses on appeal, and only after it exhausts its appeals. The commission was ruling on an appeal by Uber of a labor commissioner's award of about $4,000 in expenses to San Francisco-based driver Barbara Ann Berwick, who filed her claim in September. She worked as an Uber driver for just over two months last year. Earlier this month, Uber lost a bid to force arbitration in a federal lawsuit brought in San Francisco by its drivers. Earlier this year, the same court rejected Uber's bid to deem its drivers independent contractors, saying a jury would rule on their status. In Florida, a state agency ruled earlier this year that Uber drivers are employees.
Original Submission
(Score: 2) by darkfeline on Friday June 19 2015, @03:15AM
I'll be honest, I didn't read your huge block of writing. But
>Why does California even care about the distinction between an employee and an independent contractor again?
Because Uber is demanding "full employment" from its employees without having to take the responsibility of paying them properly (with wages AND benefits).
Employee: The company is obligated to provide full care of their employees within regulations
Independent contractor: The company pays X money for Y job. Once the contract is finished, the company and contractor go back to being two independent entities.
It's similar to fast food and retail hiring a bunch of part type temp workers instead of full time workers. The companies are exploiting employees by demanding they do the full amount of work without paying them for the full amount of work (as regulated).
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(Score: 2) by edIII on Friday June 19 2015, @11:31PM
Ok.
Well, without reading my huge block of writing, how do you know that's not what I'm saying?
Yet, it's not that simple. You might have to read the huge block to understand why I say this. Independent contractors are not automatically an oppressed and abused class. California does care about wages and benefits, and there are test to see if an independent contractor is actually an independent contractor. I've dealt with this and lawyers already, and had to face palm a couple of times. So Uber is not automatically wrong and evil, but it's wrong because of how it specifically interacts with the end customers (passengers) and immediate customers (Uber drivers). That's a little bit more involved.
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