Uber’s driving partners have been classified as employees and entitled to benefits.
Uber has received a bad news from California. Uber news confirmed that the ride-sharing platform operator’s facility has lost the battle to classify its driving partners as contracted drivers, after the state’s labor board gave a ruling that an ex-driver was a worker and a person who deserves to avail unemployment benefits.
The ruling is especially significant as it was raised twice on appeal, once to California Unemployment Insurance Appeals Board and another to an administrative law judge. The company stated that it “does not have any wider impact or set any formal or binding precedent”, which means that future cases could be decided in a different manner.
Uber news today disclosed that the case hits the center of the corporate business model, which depends on it positioning itself as a link between riders and driving partners. Many professionals have asked the question that whether it would even be supportable if it was compelled to ensure that all its contracted drivers are able to avail the benefits available to workers.
Uber technologies informed that the case was highlighted when a lawyer suing the transporter on behalf of other driving partners published documents on her webpage. The EDD decision is one of those several decisions that have appeared to undercut how Uber relies on independent contractors to shift passengers. Among else were rulings given by an authority of Florida in the past, a Californian authority, and another case this year, in which, a driver in Los Angeles was recognized by EDD as a worker and given unemployment benefits.
More importantly, the anti-Uber decision given by Inglewood is the only decision regarding which an appeal has been filed and rejected; signifying how other rulings could be challenged. It argued that cab operators are demanding the status of an independent contractor because they are interested in working independently. Eight states have recognized the transporter as an independent contractor. Some of those include Indiana, Georgia, and Colorado.
Transportation experts have shared the view that the judgment would not only add to the difficulties of the Uber but also increase its costs that would ultimately be transferred to riders. It is probable that the company’s rivals would appreciate the ruling.
Uber should treat its driving partners as employees; otherwise, it might be unable to survive in the highly competitive market. It has previously faced many administrative challenges in the past. This legal defeat has only added to its problems.