California’s labor commissioner, known as the Division of Labor Standards Enforcement (“DLSE”) has ruled that a driver for Uber should be classified as an employee of the company, a decision that marks the latest setback for the ride-hailing company’s labor model.
The ruling doesn’t set a precedent for how Uber compensates its 200,000 drivers, but it is one of a growing number of administrative agency and court decisions that may impact other cases with the company. Uber says its drivers are independent contractors and not employees, a designation that means it is not responsible for paying employment taxes, drivers’ insurance, workers compensation insurance, or job-related expenses and allows the company to operate and expand at relatively low cost.
Uber has been ordered to pay Barbara Berwick, a California driver for Uber from July 2014 to September 2014, more than $4,100 to cover the costs of vehicle mileage and tolls, the commissioner said in a June 3, 2015 ruling that was filed in California state court on Tuesday.
The regulator found that Uber is “involved in every aspect of the operation,” from vetting drivers and their vehicles to setting rates for trip fares, and therefore is legally an employer of its drivers. Uber had unsuccessfully argued that because it is just a smartphone service that matches passengers with rides, its drivers should be classified as contractors.
Uber said Wednesday it is appealing the ruling and pointed to a 2012 labor commission ruling that found one of its drivers shouldn’t be classified as an employee. “The number one reason drivers choose to use Uber is because they have complete flexibility and control,” the company said in a statement.
Appealing a Labor Commissioner Ruling is a relatively straightforward task but could result in an actual California Superior Court entering a Judgment for the employee.
If you are an employee who is owed wages, expenses, or seeking to enforce a DLSE award or a company facing a hearing, please feel free to contact Richard E. Quintilone II Esq at Quintilone & Associates [email protected] or CALL.