California Overturns Uber's Appeal: Its Drivers Are Employees, Not Contractors

An anonymous reader writes: Uber's third attempt to overturn a California court ruling stating that its drivers are employees and not contractors has ended in failure, with the appeal dismissed by the California Employment Development Department (EDD). The California Labor Commission ruled in June on the matter, and in a later appeal one judge effectively decided that the difference between 'firing' a driver and deactivating their account is purely semantic.

Comments

Re:so when

[thaylin]

Does EBAY, facebook, or youtube prevent you from selling your products if they dont like who you are selling them too? Or dont use specific things? methinks you did not read the article.

Re:so when

[ndavis]

Only if eBay is telling you what computer to use, when to use it , when you can list and what you can charge. Oh and they can dictate that you are not allowed to use competitive services while listing an item on their site. Not sure how Facebook and YouTube fit into this as they are services that you use for free via advertising.

Yes, they are employees

[duckintheface]

There are many reasons why drivers should be classified as employees rather than as contractors. The most obvious is that drivers don't price their own services. The labor laws were specifically written to protect people who are working for much more powerful companies which will treat them as serfs if they can get away with it.

Re:Yes, they are employees

[edtice1559]

Because the worker doesn't have the negotiating power. The current case is the one that proves your point. Some Uber workers want to be contractors, others want to be employees. But it doesn't matter what they want. Uber declared them to be contractors and they have no recourse except the government. An easier example is if I hold a gun to your head and demand your wallet. Yes you voluntarily gave it to me, but it's still not acceptable. The government is simply defending the powerless here the same way as police defend mugging victims.

Re:Yes, they are employees

[ShanghaiBill]

There are many reasons why drivers should be classified as employees rather than as contractors.

Yes. There are 20 reasons. Here is the list.

The most obvious is that drivers don't price their own services.

In some ways the drivers are treated like employees, and in other ways they are treated like contractors. Uber may be able to shift the balance enough to satisfy the courts, and the IRS.

Like employees:
- Uber sets the price
- Uber prohibits drivers from offering services outside of the Uber App
- Uber drivers are an integral part of Uber's business
- Uber drivers cannot subcontract
- Uber drivers are trained by Uber
- Uber drivers must follow specific procedures
- Uber drivers can quit or be fired at any time

Like contractors:
- Uber drivers set their own hours
- Uber drivers own their own equipment
- Uber drivers are not required to work full time, or a minimum or maximum number of hours
- Uber drivers do not work on Uber's premises
- Uber drivers are not directly supervised

Re:Yes, they are employees

[danbob999]

from TFA:

According to the administrative law judge who heard the first appeal, Uber has sole discretion over fares, and can charge drivers a cancellation fee if they choose not to take a ride, prohibit drivers from picking up passengers not using the app and suspend or deactivate drivers' accounts.

Based on that, "there was in fact an employer/employee relationship", according to the decision.

I agree with the judge on one point: if they were independent contractors, they would be free to pickup passengers not using Uber.

Economy

[fluffernutter]

Anyone who accepts restrictions from a company and yet doesn't want full labor protection of an employee is either totally naive about how tenuous their situation really is, or is experiencing desperation brought on by a totally shitty economy. Either way, I applaud the California decision, because corporations should not be taking advantage of either.

Re: Looks like the VCs found their unicorn

[Anonymous Coward]

Uber would have been better off arguing that it's drivers are customers, who sign up for a service that allows them to earn money. The people who ride in the cars aren't the customers, they are the product.

Is the gig economy a good thing?

[ErichTheRed]

There are all sorts of arguments about why Uber should or shouldn't have to act like a traditional taxi company. But in my opinion, that's less important than this question, for the broader economy and labor force. Social media, tech publications, and even the MBA rags have had all sorts of glowing stories about the "gig economy." Basically, they argue that the flexibility offered to workers by allowing them to string together contract jobs to make income outweighs the stability of traditional employment. Uber is cited as an example on the low end, day laborer style side, and of course, high flying "technology consultants" making $150+ an hour are put up as shining examples of why this should be the future of employment.

I'm far from a Luddite, but I'm a big believer in stability. Especially as you acquire a family and grown-up responsibilities, life in the US revolves around a steady income, health insurance and a way to save for retirement. The high-flying tech consultants can arrange for these things, but lately I've been seeing more of these cheerleading articles advocating for all employees to switch to this model. Most average employees don't have the motivation or skills to market themselves the way these consultants do, and they may lack the skills that would make them good contractor candidates.

It just seems to me that companies want a disposable labor force that they don't need to pay benefits, vacation, etc. for. Basically, they want to go back to a pre-Depression era where workers just turn up at the factory gates every morning and hope to get work. That may be appealing to Millenials who don't have any family ties and will move at the drop of a hat. If we have to go this way, then things like real estate transactions need to be streamlined, life has to be restructured around variable income levels, etc. and I think society isn't ready for it yet.