07 Aug Update: Classifying Uber Drivers
The California Labor Commissioner ruled that one of San Francisco-based Uber’s drivers is an employee, not an independent contractor. The Labor Commissioner awarded the driver just over $4,000 for incurred but un-reimbursed business expenses and interest, but denied Berwick’s request for wages, liquidated damages, and waiting time penalties.
Here, the Labor Commissioner did not rely on the traditional right to control test. Instead, she noted that the absence of such control is not necessarily dispositive where the actual details of the work required little or no supervision. The Commissioner’s decision found that other “Borello factors” justified finding that the driver is an employee. First, the Commissioner noted the fact that the driver’s work is integral to Uber’s business, which provides transportation services to passengers. Without drivers to transport the passengers, Uber’s “app” connecting potential passengers to potential rides, would be useless; its business would not exist. Second, Uber provided some of the tools essential to the work – its proprietary iPhone application. Third, Uber has total control over the service fee –if a passenger cancels, only Uber can waive the fee, not the driver, and Uber prohibits drivers from taking tips. Fourth, Uber carefully pre-screens its drivers and has the right to approve or reject the driver’s “fleet” vehicle.
The Commissioner was not persuaded by the following: that drivers make their own hours – decide whether to work or not, use their own “tools of the trade” (i.e. their own car), provide their own insurance, have to obtain their own permits, are paid “by the job” (each trip), and have no set length of employment – indeed, after a period of inactivity, their service is disconnected and the driver has to re-apply for access to the Uber platform.