Drivers suing Uber in federal court recently won a notable victory, as they have been granted class action status by U.S. District Judge Edward Chen (in Douglas O’Connor et al vs. Uber Technologies Inc., Case No. 13-3826).
In the ruling, which was handed down at the beginning of this month in a federal court in San Francisco, Chen agreed that the Uber drivers should be able to collectively sue the company regarding the issue of whether they are independent contractors or employees of the company.
Notably, Chen wrote in his ruling that Uber’s reasoning for pushing back against the class action had an “inherent tension” in that, “on one hand, Uber argues that it has properly classified every single driver as an independent contractor.” Nevertheless, Uber has also stated that its drivers are so unique that the court, “unlike, apparently, Uber itself,” has been unable to issue a determination.
Background on the Worker Misclassification Issue
The issue of worker misclassification has been a hot topic in the U.S. over the past few years, particularly in light of the U.S. Department of Labor’s guidance on the matter issued this past July. In that “Administrator’s Interpretation,” the DOL specifically noted that:
- “Although independent contracting relationships can be advantageous for workers and businesses, some employees may be intentionally misclassified as a means to cut costs and avoid compliance with labor laws.”
- Issues like the permanency of the work relationship, the nature of the work and the degree of control a worker has over the job should be considered when determining whether a worker is an independent contractor or an employee.
- Most workers in the U.S. are employees, not independent contractors.
Potential Implications of Chen’s Ruling
This remarkable ruling could end up meaning that as many as 160,000 Uber drivers in California could join the class action case. It could also end up resulting in:
- Uber drivers winning their suit and gaining the opportunity to be classified as employees.
- This, in turn, would result in Uber likely having to provide certain benefits to drivers (such as workers’ compensation coverage and/or healthcare benefits), as well as possibly even having to reimburse drivers for their operating/work-related expenses.
- A dramatic shift in the business model of the ride sharing industry, which has built its success and profits on the independent contractor model.
Given all that is at stake in light of Chen’s recent ruling, some suspect that Uber will be compelled to try to settle this case before it goes to trial.
Contact a Los Angeles Employment Attorney at Moon and Yang
If you believe you have been misclassified as an independent contractor – or if your employer has violated any of your rights as a California worker, it’s time to contact Los Angeles employment attorney at the Moon and Yang. We have a strong commitment to our clients and bring substantial experience, legal knowledge and effective resources to both simple and complex legal matters.
To find out more about our services and how we can help you, contact us today by calling (213) 232-3128 or by emailing us using the contact form on this page.
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