Wednesday, June 17, 2015

Uber deemed an employer, not a partner, to driver in California

So says the California Labor Commission according to this story from Reuters, and I would guess other jurisdictions will follow. But Uber responds that:
"Reuters' original headline was not accurate. The California Labor Commission's ruling is non-binding and applies to a single driver. Indeed it is contrary to a previous ruling by the same commission, which concluded in 2012 that the driver 'performed services as an independent contractor, and not as a bona fide employee.' Five other states have also come to the same conclusion. It's important to remember that the number one reason drivers choose to use Uber is because they have complete flexibility and control. The majority of them can and do choose to earn their living from multiple sources, including other ride sharing companies."
I would guess it is precisely the definition of "complete flexibility and control" that will be at issue going forward. I think Uber is an employer of its drivers for tax law purposes and that its drivers do not have anything like complete flexibility or control in substance.