California Labor Lawsuit Seeks to Distinguish Employees from Contractors

San Francisco, CA Yet another company involved in a California labor lawsuit is alleged to have misclassified its employees as subcontractors, denying them proper pay and breaks as owed to employees. Now, a judge has suggested he might agree with the workers, and deny a motion by the defendant to dismiss the California labor law claim.

The lawsuit involves workers who drive for Uber Technologies. The drivers perform a taxi-like service in which they pick up and drop off passengers who are sent to them via the Uber application. Plaintiffs allege Uber would not be able to perform business, nor would it make any money, without the drivers. Furthermore, they claim they must follow Uber’s requirements and can be fired from the company if they fail to do so.

Uber, however, alleges that the drivers are actually Uber customers who use the Uber application to have passengers sent to them. As such, they are not employees but clients and are therefore not subject to the same rights and protections as employees. In other words, Uber says it simply finds prospective passengers for the drivers, who are then free to accept the fare or not.

US District Judge Edward Chen seems to agree with the drivers, stating that he does not think Uber is simply a software platform that allows drivers to find potential fares. At issue is how much control Uber has over its drivers’ ability to earn a living, and how much autonomy the drivers have in carrying out their duties. According to Bloomberg (1/30/15), the judge noted that Uber determines how much money drivers are paid and has the ability to terminate them.

“[To grant Uber summary judgment], I would have to find that, viewing the facts in plaintiffs’ favor, drawing all reasonable subsidiary inferences in favor of the plaintiff, that no reasonable jury could conclude that the drivers are employees,” the judge noted (as seen in a transcript). “That’s a pretty tough standard to meet.” He went on to state that he believes the drivers are serving Uber and he noted that Uber exercises quality control.

“If [Uber is] only providing software, why would they be concerned with who’s buying it, whether they’re qualified, how they’re doing on the job?” the judge stated. “And why would they have control over the pricing, and whether to implement surge pricing or not, et cetera, et cetera… It sounds like a little more than just selling something on the app store.”

No ruling has been issued so far.

The lawsuit is O’Connor et al. v. Uber Technologies Inc. et al, case number 3:13-cv-03826 in the US District Court for the Northern District of California.