Uber Set For Trial In June

An update on the ongoing misclassification class action law suit against Uber Technologies Inc.
In O’Connor et al v. Uber Technologies, Inc., C.A. No. 13-03826-EMC (N.D. Cal.), a certified class of Uber drivers has sued the ride sharing company alleging that they are being misclassified as independent contractors, as opposed to employees. Through misclassification, the allegation is that Uber is cutting corners in payroll taxes, administrative costs, and most importantly in employee benefits.
Uber’s drivers argue that they lack control over the important and essential characteristics of their work. They point to, among other things, the price fixing of ride fares, and the authority of who can and cannot work as a driver.
Uber opposed the certification of a class of drivers, and argued that there is “no typical driver” in its fleet of ‘contractors.’ Judge Edward Chen disagreed, however, and approved a class of drivers to move forward in a class action lawsuit. Uber immediately appealed to the 9th Circuit court of appeals. On appeal, Uber altered its argument to contest two issues. First, that the “novel, unsettled, and fundamentally important questions regarding class-action claims in the new and unique context of the sharing economy” should not be heard by a jury. Uber felt that “potential ramifications of this closely-watched class-certification are difficult to overstate.” This argument was not successful.
Uber’s second argument on appeal was not immediately rejected. Uber argued that all drivers who worked for the company after June of 2014 should be excluded from the class, because at that time Uber began to include an arbitration clause that would prevent any driver from joining the class action lawsuit. This was a setback for the drivers, as it did temporarily limit the size of the class facing Uber. However, Uber’s victory was short lived.
In December of 2015, the District Court ruled that the class may include all drivers who have contracted with Uber directly and in their own name in California since 2009. Judge Chen did not treat the ride-sharing company kindly in his decision, suggesting that the new arbitration clauses were poorly timed, and “likely, frankly, to engender confusion.” He then ordered Uber to seek the courts permission before implementing similar changes in its relationships during the course of the ongoing lawsuit. Ultimately, Uber’s arbitration clause was ruled unenforceable, and the class moved forward.
Uber immediately appealed this decision, as it added more than 100,000 drivers to the class opposing it. This is significant because in addition to seeking reclassification, Judge Chen has ruled that the drivers may each seek reimbursement for every mile driven, at 57 ½ cents each. At the same time, Uber petitioned the court to delay the progression of the lawsuit until its appeal was heard and decided. On January 27th, the Ninth Circuit Court of Appeals in San Francisco ruled against Uber Technologies Inc., denying the ride sharing company’s request to delay the lawsuit.
As it stands, O’Connor et at v. Uber Technologies, Inc. is set to go to trial this June. With Uber’s competitor Lyft recently settling a very similar lawsuit and claim for $12.25 million in order to avoid the reclassification of its drivers, it remains to be seen whether Uber’s lawsuit will be affected, or whether they will be able to reach a settlement of their own.
Misclassification is a hot and growing issue in California employment law. If you think you have been misclassified as an independent contractor or have any other employment related issue, please contact Stephen Danz & Associates for a free consultation. With 10 law offices across California and decades of experience, Stephen Danz & Associates is always prepared to fight the good fight on behalf of California employees.