MarketWatch quoted Prof. Keith Cunningham-Parmeter in a story November 14 on Uber and its employment practices. In the US, ride-sharing service Uber’s employees are independent contractors. A UK court ruled last week that Uber drivers there are workers — not independent contractors — and are therefore eligible for more rights, such as a minimum wage.
Uber said it will continue appealing that case, even up to the UK Supreme Court. There are more than 10 similar lawsuits against Uber awaiting judgment in the United States. Cunningham-Parmeter, who teaches and researches in the areas of employment and labor law, has written about Uber before. He said the difference between independent contractors and regular employees is significant.
“Depending on which side of the line you fall on, you either get this huge basket of rights or basically nothing,” he said.
Most companies are required to have a minimum wage, health insurance, overtime pay and scheduled breaks for employees. Independent contractors aren’t guaranteed any of those rights. On top of that, they are required to pay their own taxes. So, if they don’t pay into the funds for unemployment or workers’ compensation, they may not be eligible for those benefits, either.
That being said, an individual switching from independent contract work for Uber or other on-demand companies to part- or full-time employment might see some drawbacks. Uber would be able to exercise more control than it does now — mandating the type of cars its drivers use or forcing them to work specific hours.
Uber isn’t the only company facing these type of lawsuits. FedEx agreed to pay 12,000 drivers $240 million last year to settle lawsuits from drivers who said they were misclassified as independent contractors and not employees. That case and others could serve as cautionary tales for Uber.
“We could see a similar pattern with Uber and the other on-demand platforms,” Cunningham-Parmeter said. “Right now there’s a big question mark hanging over Uber.”
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