Uber dealt blow in California over ’employee’ driver

 

Protestors

Uber has been subject to protests from drivers

An Uber driver in California has been deemed an employee, not a contractor, in a ruling that could mean higher costs for the app-based taxi service.

The decision by the California Labor Commission means the driver must be awarded more than $4,000 (£2,544) of expenses for the period she worked.

If applied more widely it could mean extra costs such as social security and unemployment insurance.

But Uber emphasised the ruling only applied to this one driver.

In a statement, it said a previous ruling in California and other rulings in five other US states came to the opposite view, that drivers are contractors.

“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.”

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Uber is said to have more than a million drivers

The company is now appealing against the award of more than $4,000 (£2,544) in expenses to the San Francisco former Uber driver, Barbara Ann Berwick.

That money is Ms Berwick’s “reimbursable business expenses”, according to the ruling, including tolls, parking citations, legal fees, interest and mileage.

Uber considers its drivers independent contractors and the drivers pay for their own cars, insurance, gas, tolls and general costs of operating. Drivers are paid 80% of each fare.

The California Labor Commission ruled that Uber is not just enabling the service between drivers and passengers but is “involved in every aspect of the operation”.

The commission said Uber would not exist without drivers like Ms Berwick, and that the company depends on the drivers’ work.

Uber had been arguing that is a “software platform” that simply “matches customer demand with supply”.

The app-based taxi firm has become one of the world’s most valuable start-up companies, operating in more than 50 countries and worth an estimated $50bn.

[SOURCE- “bbc.com”]