Uber drivers have been given the go-ahead by a judge in the US to launch a class-action lawsuit which could result in its model being radically altered
The drivers are fighting for the right to be classed as employees rather than independent contractors, which would give them benefits such as reimbursement for expenses incurred while driving. They also claim Uber has not passed on tips to them.
Yesterday, US District Judge Edward Chen gave the suit class A action status in court, on the basis that although it was being brought by a handful of drivers (three, to be precise), it could apply to more than 100,000 Uber drivers in California.
At the beginning of August, Uber argued its drivers are so diverse, and have such different relationships with the company, they cannot reasonably be treated as one class.
But in Tuesday's 68-page court ruling, Chen said this was not a valid argument, since Uber was describing the drivers as categorically contractors on the one hand, and as completely diverse on the other. He wrote:
Uber argues that individual issues with respect to each driver’s ‘unique’ relationship with Uber so predominate that this Court (unlike, apparently, Uber itself) cannot make a classwide determination.
Critics have suggested that if the drivers win their case, startups which rely on the use of independent contractors rather than employees could be hit. As a working system, Uber's model offers firms lower operating costs, fewer physical assets, and less liability if their contractors get into trouble.
It is also a system that suits many workers – it offers them flexible working arrangements, no set hours and the option of having multiple jobs.
But if the court rules the drivers are employees, Uber may have to alter its entire business model to accommodate this fact, as will other firms that have adopted its approach to hiring.
An Uber spokesperson said:
We'll most likely appeal the decision as partners use Uber on their own terms, and there really is no typical driver - the key question at issue.