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Limo Firm To Judge: Tell Us Whether Uber Drivers Are Employees (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: Lawyers representing a Southern California limousine company that sued Uber last month over state unfair competition allegations have now filed a motion for partial summary judgement. If the filing is granted by the judge, the motion would substantially streamline the case and answer the vexing question: are Uber drivers employees or not? The proposed class-action lawsuit, known as Diva Limousine v. Uber, relies on a recently decided California Supreme Court decision that makes it more difficult for companies to unilaterally declare their workers as contractors, which effectively deprives them of benefits that they would otherwise receive as employees.
In the California Supreme Court case, known as Dynamex, that court came up with a three-part test, known as the ABC test, to figure out whether companies can assert contractor status or not: "(A) that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact, (B) that the worker performs work that is outside the usual course of the hiring entity's business, and (C) that the worker is customarily engaged in an independently established trade, occupation, or business, the worker should be considered an employee and the hiring business an employer under the suffer or permit to work standard in wage orders." "The standard for summary judgement is that there is no triable issue of material facts. That seems to be the case here," says Professor Veena Dubal of the University of California, Hastings, which is just blocks from Uber's headquarters in San Francisco.
"Under Dynamex, workers are likely employees for purposes of minimum wage and overtime if they perform work that is within the usual course of the hiring entity's business. Uber drivers provide rides, and Uber is a transportation company that facilitates the provision of those rides. I have a hard time imagining how Uber can argue that there is a triable issue of fact here, although I am confident that they will argue that they are a software company. They have lost that argument in courts across the world."
In the California Supreme Court case, known as Dynamex, that court came up with a three-part test, known as the ABC test, to figure out whether companies can assert contractor status or not: "(A) that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact, (B) that the worker performs work that is outside the usual course of the hiring entity's business, and (C) that the worker is customarily engaged in an independently established trade, occupation, or business, the worker should be considered an employee and the hiring business an employer under the suffer or permit to work standard in wage orders." "The standard for summary judgement is that there is no triable issue of material facts. That seems to be the case here," says Professor Veena Dubal of the University of California, Hastings, which is just blocks from Uber's headquarters in San Francisco.
"Under Dynamex, workers are likely employees for purposes of minimum wage and overtime if they perform work that is within the usual course of the hiring entity's business. Uber drivers provide rides, and Uber is a transportation company that facilitates the provision of those rides. I have a hard time imagining how Uber can argue that there is a triable issue of fact here, although I am confident that they will argue that they are a software company. They have lost that argument in courts across the world."
Well, it has been almost a week since we last rehashed this topic, so let's do a review. There is no ONE criterium that makes someone a contractor or employee. The IRS has a 20 point checklist (listed below). Uber meets some of the criteria, and doesn't meet others. But it is a checklist, not a scorecard. So does that mean their drivers are employees? Answer: Maybe.
Also, it is not necessarily "better" to be an employee ... or a contractor. Employees tend to get more benefits in addition to their pay, but also tend to be paid less and have less flexibility.
1. Must the individual take instructions from your management staff regarding when, where, and how work is to be done?
2. Does the individual receive training from your company?
3. Is the success or continuation of your business somewhat dependent on the type of service provided by the individual?
4. Must the individual personally perform the contracted services?
5. Have you hired, supervised, or paid individuals to assist the worker in completing the project stated in the contract?
6. Is there a continuing relationship between your company and the individual?
7. Must the individual work set hours?
8. Is the individual required to work full time at your company?
9. Is the work performed on company premises?
10. Is the individual required to follow a set sequence or routine in the performance of his work?
11. Must the individual give you reports regarding his/her work?
12. Is the individual paid by the hour, week, or month?
13. Do you reimburse the individual for business/travel expenses?
14. Do you supply the individual with needed tools or materials?
15. Have you made a significant investment in facilities used by the individual to perform services?
16. Is the individual free from suffering a loss or realizing a profit based on his work?
17. Does the individual only perform services for your company?
18. Does the individual limit the availability of his services to the general public?
19. Do you have the right to discharge the individual?
20. May the individual terminate his services at any time?