Uber is becoming a regular in the courtroom. Many are familiar with Uber’s fight to label their workers as independent contractors rather than employees. There has been a swarm of lawsuits in the past years in multiple cities regarding this issue.
Uber is beyond thrilled after receiving a court decision that denied a driver’s bid to be treated as an employee rather than an independent contractor. Uber is now asking a California judge to grant a stamp of approval on what it says is the first decision by an arbitrator denying a driver’s bid to be treated as an employee instead of an independent contractor.
Why does Uber keep fighting in order to continue to incorporate its “driver partner“ business model? By labeling drivers an independent contractor, there are many expenses as well as other down sides that you can be relieved of. As independent contractors, Uber drivers are technically not employees of Uber. That means Uber doesn’t have to pay payroll taxes on them or cover workers compensation or unemployment insurance, all of which are high costs for any business. It also means drivers take on their own expenses of doing their job like supply their own cars and pay for gasoline, and they aren’t protected by the same workplace laws (like the minimum wage) that cover most other workers. Economist Alan Krueger and former Labor Department official Seth Harris argue that when it comes to gig economy platforms like Uber, neither the “employee” nor the “independent contractor” label really works. Uber argues that drivers aren’t employees because they set their own schedules. Being in the independent contract category is questioned in part because Uber dictates their pay rates and other conditions.
Labor and employment lawyer with Seyfarth Shaw, Candace Bertoldi gave her input on this issue stating “Uber isn’t required to seek confirmation of an arbitration award by a state judge, especially if there isn’t a financial component. The ride-hailing company may have chosen to do so as a strategic move to influence other cases and deter future litigation, said Bertoldi, who isn’t involved in the case.”
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