Lawsuit over driver employee classification could change face of Uber
SAN FRANCISCO (KTVU) - A federal court judge will decide whether to grant “Class Action Status” to a lawsuit filed by three Uber drivers Thursday.
The case is being described as one that could “make or break Uber.”
The three Uber drivers have sued the company saying they’re misclassified in terms of their job status. Uber currently designates drivers as “independent contractors” instead of employees.
By doing that, Uber is able to save on several costs including things like provided a car for the drivers, health insurance, social security, overtime and paid sick leave.
It’s a business model that Uber and other on-demand businesses depend on.
On Thursday a judge will decide if this lawsuit should proceed as a class action suit or just pertain to the three drivers in question. The cost between the two outcomes could be huge.
If a judge says its only about the three drivers, then some legal experts say Uber could decide whether to settle. But if Class Action status is granted, Uber would have to change their business model and deal with the 160,000 drivers here in California and manage a workforce that would be millions worldwide.
According to CNET, Uber tried to have the lawsuit thrown out back in March. According to that report, Uber provided hundreds of statements from drivers who do not want to be classified as “employees.”
Although attorneys representing the three drivers say that is not the case, they claim many drivers are unhappy with how they are currently treated by Uber.