Judges May Deflate Massive Opportunity By Declaring Uber, Lyft Drivers 'Employees' Rather Than Independent Contractors

from the this-won't-help-anyone dept

There are two big lawsuits that had hearings last week in California concerning how the car hailing (since some people get upset at the term "ride sharing") services Lyft and Uber operate. Both companies insist that what they provide is, in effect, a service marketplace, in which buyers (riders) and sellers (drivers) can connect (at preset prices) for rides. Under such a setup, the drivers have always been considered independent contractors who are using Lyft and Uber to find riders. Yet in both of these lawsuits drivers are trying to get themselves declared employees of the company, rather than independent contractors. So far, that argument seems to be winning as Judge Vincent Chhabria in the Lyft case on Thursday and Judge Edward Chen in the Uber case on Friday indicated that the drivers have a strong case.

In the press, many have focused on the emails that were revealed in the Uber case (which Uber sought to block, claiming they were trade secrets), in which Uber employees gleefully and profanely discuss banning bad drivers. The drivers argue that this shows that Uber had the ability to terminate their employment, making them more like employees. But that doesn't make much sense, and if true, it could present problems for all sorts of online services. Plenty of sites, from eBay to Yelp to Twitter all involve outside users making use of their platform -- where the companies have the right to terminate their use of the platform, but that doesn't make the users "employees."

The IRS Guidelines on the difference between an independent contractor and an employee, under my reading, seem to clearly indicate these drivers are independent contractors. They set their own hours. They provide their own equipment. They decide how to go about completing the job.

This case, in many ways, reminds me of similar attempts to have independent users declared employees. Not too long ago, some Yelp reviewers sought to be declared employees. And, back in 1999, a bunch of AOL volunteer chat room monitors sued to be declared employees of AOL. AOL eventually paid up to settle that lawsuit, but all of these kinds of cases threaten internet platforms like these. When users of those platforms can suddenly demand to be called employees -- with all of the related salary and benefits associated with such, it creates tremendous liability for these platforms, and makes the entire internet, and the various services it provides less useful.

The drivers in these cases are relying on a recent precedent of FedEx drivers being declared employees, rather than independent contractors, but in that case, it actually makes more sense. The drivers are wearing FedEx uniforms, and often driving FedEx provided vehicles -- and even there, the rulings in FedEx cases across the country have been mixed (and the cases are still going).

There certainly are companies that try to game the system to name people as contractors rather than employees, but in this case, rulings against Lyft and Uber (no matter what you think of those two companies and their business practices) could result in some serious challenges for a number of really useful services that use the internet to enable great services to the public. One hopes, at the very least, that should these rulings go the wrong way, that the federal government and various state governments will, at the very least, update their rules for employee v. contractor classifications to make sure these services can survive.

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  • identicon
    Anonymous Coward, 5 Feb 2015 @ 10:31am

    Mike, I really think you should take a look at this article by Robert Reich and that they SHOULD be classified as employees.

    http://www.huffingtonpost.com/robert-reich/the-sharethescraps-econom_b_6597992.html

    reply to this | link to this | view in chronology ]

    • identicon
      jackn, 5 Feb 2015 @ 11:02am

      Re:

      Here's an authoritative resource,

      http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-S elf-Employed-or-Employee

      Good luck supporting your conclusion based on your hatred and capitalization.

      reply to this | link to this | view in chronology ]

    • icon
      Mike Masnick (profile), 5 Feb 2015 @ 11:15am

      Re:

      Mike, I really think you should take a look at this article by Robert Reich and that they SHOULD be classified as employees.

      That article is not even remotely convincing. It's also incredibly misleading.

      reply to this | link to this | view in chronology ]

    • identicon
      David, 5 Feb 2015 @ 12:23pm

      Re:

      I'm not really seeing anything in the article that shows why they should be classified, but only lamenting that the jobs aren't designed as employees. If they wanted to taxi people around for a living, as an employee, there are still taxi companies where that can be done.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 5 Feb 2015 @ 2:17pm

        Re: Re:

        You argument assumes the consequent. Specifically, the REASON there are taxis "where that can be done" is BECAUSE those taxi companies obey the laws. The thing to be shown is Uber is NOT in violation of those laws. You can't just say "it's this way at Uber and this other way with regular taxi companies, so choose". That is assuming that Uber is not flouting the law. If Uber IS flouting the law, then your argument is specious because it's decidedly NOT "that" way at Uber or anywhere else and all taxi drivers ARE employees, by law.

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 5 Feb 2015 @ 12:34pm

      Re:

      "Meanwhile, human beings do the work that's unpredictable - odd jobs, on-call projects, fetching and fixing, driving and delivering, tiny tasks needed at any and all hours - and patch together barely enough to live on."

      The smart, hard working, humans that do a good job at things that others can't do a good job at can demand more pay. Plumbers, electricians, computer repairmen, and independent contractors of all sorts that are good at what they do can charge more. Become better than everyone else at stuff, work hard, invest the time necessary to learn new things that people need and to adapt with the times, and charge a lot of money for it.

      The real problem is trades change with time. How do you make all this money doing 50 different things and be able to put it in the bank without having a license for each and every one of them? Many people find ways around it by simply having one trade as a front and they'll funnel everything else they do through that trade (ie: I can be an independent car tower and when I fix someone's computer or do some other odd job I'll put cash in my bank account under my tow truck business) but, to some extent, you need to be careful not to get caught or else you may get penalized. To some extent this is a problem with our legal system. But the point is that if you work hard to be a fast learner and good at being able to adapt to whatever people want you can charge good money for your work. Or else they can go somewhere else, pay less, and have whomever they paid screw up the job badly and make things much worse. Their choice. Many people will choose to pay someone more to get the job done right and if you're that someone you can demand more or else ...

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 5 Feb 2015 @ 12:53pm

        Re: Re:

        Also there is the liability aspect of it. If you're not licensed to do something and someone sues you because they get hurt that's a risk. Obviously you should pick low risk jobs like computer repair, tutoring, etc... Not being licensed could mean you maybe liable even if what happened isn't your fault, similar to driving without a license and getting into an accident even if it's not your fault. To some extent that's a problem with our legal system potentially assigning liability where there should be none and not with robotic and computerized automation. The fact is you maybe good at multiple things and you don't know where your next opportunity will come and trying to acquire and maintain 50 different licenses for 50 different things is very expensive and risky. Not having them can also be risky. If you do something and someone sues you for something that's not your fault you shouldn't automatically be liable just because everything you can possibly do to make money requires a license and those licenses need to constantly be renewed so some licensing boards can continue to receive a do nothing lucrative passive income. The requirement to have a limited taxi-cab medallion to work as an independent driver, due to political corruption, is also ridiculous. It's not automation or Uber or anything that's killing our economy it's the government and all the political corruption behind it. Technology is creating new ways to make money that don't yet require a license that makes some corrupt licensing board lucrative amounts of money for doing nothing and that's economically a good thing and what the big media is screaming about is the fact that people are able to make money without some do nothing intermediary making money.

        Heck, even gardeners make good money. They charge, what, $60 to mow and trim (depending on how much work it is). There is work out there you just have to charge for it, do a good job, and be willing to work.

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        • identicon
          Anonymous Coward, 6 Feb 2015 @ 1:52am

          Re: Re: Re:

          If i get into a taxi to go from here to there. I expect the taxi to get me there promptly, uithin the speed limit,and safely, without accident or breakdown. If I am injured during the trip I will be suing someone. If the driver hasn't a clue which way to go I will be angry at the management of that city's taxi fleet.
          If the taxi fare doesn't cover the cost of running the car, the insurance, wages for the driver, (employee), hourly rate (indepenent contractors' retirement fund, health fund, holiday fund, sickness fund, income & other taxes, and living wage), despatch service fee, then the driver is being ripped off. If the only way a driver makes a living wage is to skimp on health, holidays, retirement, and demand tax-breaks the problem is the fare is too low.
          The dispatch services always get their pound of flesh, how else do drivers recieve fares

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          • identicon
            Anonymous Coward, 6 Feb 2015 @ 9:11pm

            Re: Re: Re: Re:

            Uber pays considerably more than what taxi cab drivers used to get paid before medallion holders had to compete with Uber for drivers. I talked to them and often they just barely made minimum wage, if that. I know someone that does Uber on the weekends and he says he gets considerably more per hour working for Uber than working a different job for someone else. These days employers try to keep everyone as part time employees so they can avoid paying them benefits and whatnot.

            The primary problem with Uber is that now taxi cab medallion holders must compete for drivers (so they must pay them more) and customers (so they must charge them less). The do nothing intermediates don't get to make as much. Corrupt politicians want kickbacks in exchange for forcing drivers to be taxi cab employees getting paid slave wages while giving the do nothing medallion holders the overwhelming majority of what the drivers worked hard for and issuing a limited amount of licenses so that medallion holders can charge way more. The fact of the matter is that Uber disrupts this corrupt business model and our corrupt legal system can't have that. Everyone must be a hard working low paid employee making money for a do nothing employer who charges monopoly prices for such services. The government can't let people go independent, how are politicians supposed to get kickbacks. That's the real issue here and anyone denying it is likely a corrupt liar. If you were honest your focus should be more on abolishing limited medallions and not on the fact that Uber has done a very good thing for consumers and drivers. It's the taxi drivers that do all the work, why should medallion holders get a cent (just because they offer politicians kickbacks). That's essentially legalized theft. It's an outrageously corrupt and unfair system and your focus should be more on abolishing this atrocity than on attacking Uber if you had any integrity.

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          • identicon
            Anonymous Coward, 7 Feb 2015 @ 2:37am

            Re: Re: Re: Re:

            "If the driver hasn't a clue which way to go I will be angry at the management of that city's taxi fleet. "

            Uber has GPS. What, are you still stuck in the last century or something?

            "then the driver is being ripped off."

            The driver voluntarily chooses to use Uber because he sees it as better than his next best opportunity (ie: either being unemployed altogether or working harder for someone else at much lower pay). Who are you to decide for someone else what you think is best for them.

            The reason the government wants to do anything it can to destroy these services is because it wants to force these drivers to go work much harder for someone else for much less pay. The government wants to turn everyone into slaves. Giving people the option of going independent makes employees less desperate which forces employers to treat their employees better and pay them more in order to attract them. That's not what the government wants. I'm no fool, I see exactly what's going on here.

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  • identicon
    Anonymous Coward, 5 Feb 2015 @ 10:33am

    and, YOU ARE FIRED

    reply to this | link to this | view in chronology ]

  • icon
    TasMot (profile), 5 Feb 2015 @ 10:36am

    Need a Bright Line

    The problem with all of these cases where someone takes a position as an independent contractor and then wants retroactive employee benefits is that it is a short term money grab. They didn't like the deal they took and now they want to go back and change the deal (with them getting more money of course). The result of one of these cases should be a "bright line" ruling which declares in advance what are the properties of being a contractor and what are the properties of being an employee. As a real life independent contractor, I don't want the court to suddenly tell me I'm actually an employee. If I hire an independent contractor I don't want to be suddenly responsible for a boat load of retro-active benefits.
    I sure hope that these court cases with set a precedent and define what a contractor actually is.

    reply to this | link to this | view in chronology ]

    • identicon
      David, 5 Feb 2015 @ 12:25pm

      Re: Need a Bright Line

      Why don't some of the 'I want to be an employee' have some of their wages taken back to pay the 7.25% of company-paid SS/Medicare, tax withholding, insurance premiums, etc that an employee doesn't get in their pay envelope?

      reply to this | link to this | view in chronology ]

      • icon
        Murray (profile), 6 Feb 2015 @ 5:36am

        Re: Re: Need a Bright Line

        From a tax standpoint, there might be a significant effect on the "employee's" Federal taxes. Any unreimbursed employeee expenses (such as gas, tolls, depreciation of the car, repairs, etc.) would be miscellaneous itemized deductions, only deductible to the extent that they exceed 2% of adjusted gross income. And there might be a significant effect on Alternative Minimum Tax since miscellaneous itemized taxes are not deductible for AMT. The Uber "employee" might pay much higher tax than the Uber independent contractor.

        reply to this | link to this | view in chronology ]

    • icon
      nasch (profile), 6 Feb 2015 @ 3:23pm

      Re: Need a Bright Line

      The result of one of these cases should be a "bright line" ruling which declares in advance what are the properties of being a contractor and what are the properties of being an employee.

      If the IRS rules aren't sufficient to prevent lawsuits, why would a court ruling do the trick? I haven't read them (sounds extremely boring), are they vague or confusing?

      reply to this | link to this | view in chronology ]

      • icon
        TasMot (profile), 6 Feb 2015 @ 5:02pm

        Re: Re: Need a Bright Line

        I am an independent contractor (in computer consulting where there has been a lot of legal wrangling). I have had to convince client's that I am an actual independent by incorporating my own company so that I can prove that I am receiving a W-2 as well as various other criteria. I did spend a lot of time reading the rules and prior cases. The actual deciding factor seems to be which way the IRS can get more money.
        In all the cases that have been decided that I was able to read about, after an independent contractor had been in place for a while (sometimes years), the IRS ruled that they were not actually an independent contractor and that the client company owed back employment, FICA and Medicare taxes. The "rules" have many grey areas.
        If a court hands down a ruling and includes "Bright Line Rules" it means that they have laid out the rules that everyone (not just lawyers) can look at and know how to determine which way the court would rule. One example is that in order to search your house a warrant is required that specifies what the suspected crime is and what evidence the search should find. The police are not allowed to just drive up and walk into your home uninvited and dig around for anything they can find that might indicate illegal activity. A "Bright Line" ruling should eliminate most if not all of the gray areas whether someone is an employee or independent contractor.
        It could include things like is the person paying all of the correct Federal, State, FICO and Medicare taxes. Is the client company filing a proper 1099 for the contractor (which is a report to the IRS of the contractor's payments, is the contractor working for more than one client, and so on.
        That way, everyone would know that if it swims like a duck, walks like a duck, has a short neck like a duck, and quacks like a duck, then it is really a duck and not a swan. The rules as they stand are "subject to interpretation" and the government (and especially the IRS) can make whatever interpretation they want in each case.

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        • icon
          nasch (profile), 6 Feb 2015 @ 8:36pm

          Re: Re: Re: Need a Bright Line

          If a court hands down a ruling and includes "Bright Line Rules" it means that they have laid out the rules that everyone (not just lawyers) can look at and know how to determine which way the court would rule.

          That is true, but only in that jurisdiction. It would be even better if the IRS wrote clear rules. Of course any ambiguity could be on purpose so that they can later apply them differently in different situations to suit themselves, so the courts may end up being the best available solution anyway.

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          • identicon
            Anonymous Coward, 8 Feb 2015 @ 3:00am

            Re: Re: Re: Re: Need a Bright Line

            My dad used to order his cigarettes from out of state online at one time years back and the franchise tax board imposed a tax on imported cigarettes. Though he suspected that he probably had to pay tax on the imported cigarettes at the time the firm that does his accounting insisted it was OK and there was no tax. Like five years later the FTB sends a letter saying that he owed back taxes, interest, and penalties. His accounting firm ate the penalties but my dad had to eat the back taxes and the interest.

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  • icon
    AricTheRed (profile), 5 Feb 2015 @ 10:40am

    Damn!!

    I've just realized, I've been an ebay employee for over 10 Years!

    I'm putting that on my resume, and I want my health insurace expenses reimbursed too ebay! Now!

    reply to this | link to this | view in chronology ]

  • icon
    BigDumpDuck (profile), 5 Feb 2015 @ 10:59am

    Are Uber drivers permitted to contract with other "market providers"? It is one thing if drivers can contract out with other Transportation Network Companies, but if they can't I don't see how they are going to get around being their employer.

    reply to this | link to this | view in chronology ]

  • icon
    GMacGuffin (profile), 5 Feb 2015 @ 11:11am

    Dicey...

    In CA, the issue of Employee v. Indy Contractor has tests that breed results all over the map. The bottom line query is who controls the manner and means of production. Factors to consider include the degree of control exercised by the company, whose equipment & offices, etc.

    Here, the big tell for me is the IC's don't have to work at all if they don't want to (per my understanding). And it seems a thorny issue is that Uber/Lyft may set the prices, but are otherwise just the platform (unlike, say, a web developer who is an IC, but is still given specific tasks by the company, not third-party site users).

    The public requests the service, the platform sends it out, a driver picks it up. That sounds like IC to me.

    But ... then there is the fact that in many (other) legal contexts, the law is designed to weigh in favor of finding the party an employee (which makes sense as far as companies who regularly try to screw their workers with creative workarounds to making them employees).

    Anyway, let's freaking hope they aren't found employees, as that would seem to set a dangerous precedent to online platforms in general.

    NOTE: Robert Reich's story is a humanist piece about a normative world. It is about the way he thinks the law should be, not necessarily what it is.

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  • icon
    hij (profile), 5 Feb 2015 @ 11:25am

    This is awesom!

    This is the best way possible to bring the unemployment rate down rapidly. Just post something on ebay/glassdoor/pinterest/whatever and you are automatically employed.

    Where is my health insurance techdirt???

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 5 Feb 2015 @ 11:33am

    'The IRS Guidelines on the difference between an independent contractor and an employee, under my reading, seem to clearly indicate these drivers are independent contractors. They set their own hours. They provide their own equipment. They decide how to go about completing the job.'

    you haven't taken into account the 'encouragement' the judge(s) will get, along with the free rides, if they come down on the side of the cab companies!

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  • icon
    DannyB (profile), 5 Feb 2015 @ 11:53am

    Maybe the judge is trying to destroy Uber and Lyft?

    Just suppose. The judge doesn't like these ride sharing services, and despite his obligation to impartially judge the case on the facts before him, he sees this as an opportunity to destroy ride sharing services.

    Just think how would this work for Uber if their drivers were now employees. Would Uber now need a payroll? HR? An accounting system, paying employer share of payroll taxes? Benefits? There would need to be documentation of people hired and terminated.

    It would be a burden. Maybe that's what the judge wants.

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  • icon
    Mark Gisleson (profile), 5 Feb 2015 @ 12:34pm

    Having written thousands of resumes

    I understand and respect that many in the tech community love being independent contracts, and financially flourish under those rules. They are the exception. In virtually every other field I worked with, independent contractors were little more than abused and underpaid employees.

    Nearly ALL workers benefit from the legal protections afforded employees, but not independent contractors. From newspaper carriers to pizza delivery folks, indie contractors get the short end of the stick while being held to the same standards as employees without the benefits.

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  • identicon
    Richard Reibstein, 5 Feb 2015 @ 1:13pm

    Comment about article

    This is a fine article. It closes with a genuine, but I am afraid an unrealistic, hope that "One hopes, at the very least, that should these rulings go the wrong way, that the federal government and various state governments will, at the very least, update their rules for employee v. contractor classifications to make sure these services can survive." If anything, laws and judicial decisions are going in the other direction. The best way to survive a challenge is to enhance independent contractor compliance, using a system such as IC Diagnostics™,http://independentcontractorcompliance.com/legal-resources/ic-diagnostics/, and proceeding to restructure, re-document, and re-implement the independent contractor relationship. Richard Reibstein, reibsteinr@pepperlaw.com

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  • icon
    Michelle (profile), 5 Feb 2015 @ 2:08pm

    Uber

    Uber was ordered to stop services in here in Boise, once again, if government doesn't make a dime, then nobody gets anything.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 5 Feb 2015 @ 2:13pm

    Major opportunity for whom? For the piece work drivers who are left to tryb to cobble together something resembling economic security by scrambling for the crumbs dropped from the tables of well funded 'visionaries" who rake it in at everyone else's expense.

    It's called democracy. People in this democracy aren't wild about laizze-fare capitalism the way the Ayn Randian heroines of the books on your library shelf are. They prefer regulation of their taxis and services for both their own safety and the welfare of the otherwise strangers who function as their drivers (the welfare of strangers.. what a shocking idea!)

    Hey the 19th century called. They want their jungle and their robber barons back.

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    • icon
      Bamboo Harvester (profile), 5 Feb 2015 @ 3:33pm

      Re:

      People in this democracy aren't wild about laizze-fare capitalism the way the Ayn Randian heroines of the books on your library shelf are. They prefer regulation of their taxis and services for both their own safety and the welfare of the otherwise strangers who function as their drivers (the welfare of strangers.. what a shocking idea!)

      If that were true, not only would this be a self-limiting problem, but it would have already ceased to exist.

      reply to this | link to this | view in chronology ]

    • icon
      John Fenderson (profile), 5 Feb 2015 @ 3:39pm

      Re:

      "They prefer regulation of their taxis and services for both their own safety and the welfare of the otherwise strangers who function as their drivers"

      Given that ride-sharing services like Uber are wildly popular everywhere they turn up, both with passengers and drivers, I don't think this is actually true.

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      • identicon
        Pragmatic, 6 Feb 2015 @ 6:06am

        Re: Re:

        People tend to care about cost first and risk later. If, "later" is when you're in hospital after being in a collision, they're concerned about risk.

        The answer may be to create a professional drivers' license for drivers who pick up paying passengers along with other driving jobs, e.g. courier work. This would cover all aspects of professional driving, not just taxi or courier work. I'm just throwing this out... is it feasible? Is it necessary?

        Actual taxi and courier drivers need licenses and insurance to cover those risks. It's unfair that someone else can pop up, do the same job for less, but not have to pay for the licenses and insurance that the others do. Since I used to work for an insurance company, I do understand the risks they're insured and licensed for.

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        • icon
          John Fenderson (profile), 6 Feb 2015 @ 6:51am

          Re: Re: Re:

          "People tend to care about cost first and risk later."

          Are these ride-sharing services less expensive than taxis? I had always assumed they were more expensive, since they give greater value.

          "Actual taxi and courier drivers need licenses and insurance to cover those risks."

          So do Uber drivers (and probably Lyft, but I'm not sure).

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        • icon
          nasch (profile), 6 Feb 2015 @ 3:28pm

          Re: Re: Re:

          The answer may be to create a professional drivers' license for drivers who pick up paying passengers along with other driving jobs, e.g. courier work.

          You mean a commercial driver's license?

          reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 5 Feb 2015 @ 3:20pm

    Where we are headed

    As I was reading the Reich article a previous AC linked, in his description of jobs that required a human, a funny reality occurred to me.

    Uber and Lyft are just momentary blips in the evolution of technology, much like video stores. Auto-driving cabs will be here sooner than we realize, and then the taxi industry and the ride contracting industry will suddenly find themselves as strange bedfellows, lobbying local politicians to outlaw auto-driving cabs.

    reply to this | link to this | view in chronology ]

  • identicon
    Matthew A. Sawtell, 5 Feb 2015 @ 5:09pm

    Ah yes... contracting ourselves to the bottom

    It has been a bit amusing to watch this latest attempt to contract out yet another element of the economy - with the usual amount of pomp and B.S. from the various corners of the political spectrum (this website included). Figure it will be just a matter of time when some enterprising fellow attempts to lobby Congress to open up another type of visa to allow even cheaper drivers to be allowed to 'ply their trade'.

    http://www.mercurynews.com/business/ci_26778017/tech-company-paid-employees-from-india-little -1

    What was the quote from Thomas Jefferson?

    Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains.

    reply to this | link to this | view in chronology ]

    • icon
      nasch (profile), 6 Feb 2015 @ 4:28pm

      Re: Ah yes... contracting ourselves to the bottom

      with the usual amount of pomp and B.S. from the various corners of the political spectrum (this website included).

      Are there any statements in particular you'd like to rebut?

      reply to this | link to this | view in chronology ]

  • identicon
    For what it's worth, 6 Feb 2015 @ 5:21am

    The bigger picture

    There are lots of great points in this thread, and while it would be fun to enter into the argument about employee vs independent contractor, the reality is that either outcome is bad for Uber.

    Before I get into why, it's important to understand two things; The fundamental requirements of being an independent contractor, and how employers and individuals benefit from hiring employees and contractors.

    While many states have specific guidelines on being an independent contractor, the common these is that they're truly "Independent" and can make their own schedule, and choose/decline work based on personal preferences.

    From an operations perspective, businesses benefit from the employee model by having control over the individual. Deadlines and productivity goals can't be guaranteed unless you have reliable labor resources, so being able to command individuals to work a prescribed schedule and perform tasks that might not otherwise want to is key. Of course this comes at a higher cost, as employees are subject to wage and overtime laws, whereas independent contractors are not.

    Before Uber was even a dream, the Taxi and Limousine industry had encountered these issues, with some companies being sued out of business for violating labor/wage law. The post mortum in these cases showed that in some cases the businesses were clearly taking advantage of the workers by treating them like employees and paying as independents, but in many cases the individuals simply didn't care. As individuals they just wanted to work, as much as they could, because they had families to support, and didn't care about the time and a half - they just needed to work 100 hours per week to make ends meet. The bottom line is that these cases were more political than justice, were about creating more jobs in a down economy, and the net effect was that most business switched to employee models to insulate themselves from future liability, then hired more people to eliminate the overtime.

    In conclusion, the results of this case will set a precedent that eventually levels the playing field, allowing the traditional transportation companies switch back to the independent contractor model, lowering the prices and allowing them to once again compete on price, or it will force the app based companies to raise prices. What do you think it better?

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  • icon
    jbacot1 (profile), 6 Feb 2015 @ 6:17am

    Driver Status

    The right to control, ability to hire and fire, training, and control of the sales process by Uber clearly show the drivers are employees whether part time or full time. The company requires acceptance of a percentage of fares from drivers, can "deactivate/terminate" drivers at will, trains the drivers, provides insurance coverage, sometimes pays the drivers, controls the rates and sales process, gives signing bonuses and guaranteed pay, etc. Uber claims to have "industry leading background checks" which is not true and then denies doing and driver assessment in its terms and conditions. It's not the drivers that are trying to play with their status, it is the company.

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  • identicon
    Tommy, 6 Feb 2015 @ 8:01am

    uber,lyft

    It's bad enough that other ride service companies are whinning that Uber and Lyft offer a better ride and fair price experience, specifically the cabbies who are more then happy to rip off they're riders. Now we have to deal with drivers who are demanding to be employees, wtf is your problem people, why do you want to f### up a good thing, you are ic's earning fair money, you can claim all your expenses on your taxes and you will get back a nice refund. leave it alone!!!! If you don't like the way things are, find a job elsewhere, you can become an employee and work for a company who doesn't give a damn about they're employee's.

    Tommy, Uber & Lyft driver

    reply to this | link to this | view in chronology ]


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