Uber’s model of classifying drivers as contractors has been a leading story in the ongoing discussion of how to classify an employee. The 9th U.S. Circuit Court of Appeals in San Francisco s decision and compels arbitration in three lawsuits. The appeals court vote was 3-0.
The court also overturned the class certification involving one case where thousands of drivers complained that they were misidentified as contractors so the company would not have to pay for vehicle maintenance, gas and other expenses. The impact is that there can be no class action against the company, leaving plaintiffs to individually sue the company rather than do it as a group.
This means plaintiffs face greater legal expense with potential settlement of lesser amount. It also impacts cases where there is arbitration. Expecting this ruling, an attorney for the drivers said that they planned to move forward with the individual suits if that is what the company wants.
A Supreme Court decision felt in lower court
The appeals court took the lead from a May 2018 U.S. Supreme Court decision of Epic Systems Corp v Lewis, which ruled that workers could be compelled to arbitrate various workplace disputes rather than file a class action suit. Many see this ruling as a major blow to workers’ rights.
Contractor vs. full time employee
Many companies today are wrestling with how to classify employees. Uber has been in several lawsuits involving employee classification, but not every company has the time or the interest in wresting over these issues. An employment law attorney can help companies determine the best course of action, either to avoid litigation or to provide a strong case to reduce the time in court.