Uber drivers are freelancers, not employees, judge rules

* First federal ruling on the gig economy

A U.S. judge in Philadelphia has ruled that limousine drivers
for Uber Technologies Inc are independent contractors and not the
company’s employees under federal law, the first ruling of its kind
on a crucial issue for the ride-hailing company.

U.S. District Judge Michael Baylson on Wednesday said San
Francisco-based Uber does not exert enough control over drivers for
its limo service, UberBLACK, to be considered their employer under
the federal Fair Labor Standards Act. The drivers work when they
want to and are free to nap, run personal errands, or smoke
cigarettes in between rides, Baylson said.

The legal classification of workers has been a major issue for
“gig economy” companies that rely on independent contractors. Uber,
in particular, has been hit with dozens of lawsuits in recent years
claiming that its drivers are employees and are entitled to minimum
wage, overtime, and other legal protections not afforded to
contractors.

An Uber spokeswoman said the company is pleased with the
decision.

Jeremy Abay, a lawyer for the plaintiffs, said he would appeal
the ruling to the Philadelphia-based 3rd U.S. Circuit Court of
Appeals. The 3rd Circuit would be the first federal appeals court
to consider whether Uber drivers are properly classified as
independent contractors.

Many of the cases filed against Uber have been sent to
arbitration, but the plaintiffs in the Philadelphia case were among
a small minority of drivers who had opted not to sign arbitration
agreements with the company.

Last year, a state appeals court in Florida said Uber’s drivers
were not its employees under Florida law. But state agencies in
California and New York have said that they are under those states’
laws.

Baylson in Wednesday’s ruling said he was the first judge to
rule on the classification of Uber drivers under federal law. His
ruling comes about two months after a federal judge in San
Francisco said that food delivery workers for Grubhub Inc were not
the company’s employees.

The Grubhub case was the first of its kind against a so-called
gig economy company to go to trial.

The Philadelphia lawsuit was filed in February 2016. The
plaintiffs said Uber failed to pay them minimum wage and overtime
in violation of the Fair Labor Standards Act, which only applies to
employees. The plaintiffs were seeking to represent all drivers in
Philadelphia for Uber’s limousine service, UberBLACK.

The case is Razak v. Uber Technologies Inc, U.S. District Court
for the Eastern District of Pennsylvania, No. 2:16-cv-00573.

reuters

* First federal ruling on the gig economy

A U.S. judge in Philadelphia has ruled that limousine drivers
for Uber Technologies Inc are independent contractors and not the
company’s employees under federal law, the first ruling of its kind
on a crucial issue for the ride-hailing company.

U.S. District Judge Michael Baylson on Wednesday said San
Francisco-based Uber does not exert enough control over drivers for
its limo service, UberBLACK, to be considered their employer under
the federal Fair Labor Standards Act. The drivers work when they
want to and are free to nap, run personal errands, or smoke
cigarettes in between rides, Baylson said.

The legal classification of workers has been a major issue for
“gig economy” companies that rely on independent contractors. Uber,
in particular, has been hit with dozens of lawsuits in recent years
claiming that its drivers are employees and are entitled to minimum
wage, overtime, and other legal protections not afforded to
contractors.

An Uber spokeswoman said the company is pleased with the
decision.

Jeremy Abay, a lawyer for the plaintiffs, said he would appeal
the ruling to the Philadelphia-based 3rd U.S. Circuit Court of
Appeals. The 3rd Circuit would be the first federal appeals court
to consider whether Uber drivers are properly classified as
independent contractors.

Many of the cases filed against Uber have been sent to
arbitration, but the plaintiffs in the Philadelphia case were among
a small minority of drivers who had opted not to sign arbitration
agreements with the company.

Last year, a state appeals court in Florida said Uber’s drivers
were not its employees under Florida law. But state agencies in
California and New York have said that they are under those states’
laws.

Baylson in Wednesday’s ruling said he was the first judge to
rule on the classification of Uber drivers under federal law. His
ruling comes about two months after a federal judge in San
Francisco said that food delivery workers for Grubhub Inc were not
the company’s employees.

The Grubhub case was the first of its kind against a so-called
gig economy company to go to trial.

The Philadelphia lawsuit was filed in February 2016. The
plaintiffs said Uber failed to pay them minimum wage and overtime
in violation of the Fair Labor Standards Act, which only applies to
employees. The plaintiffs were seeking to represent all drivers in
Philadelphia for Uber’s limousine service, UberBLACK.

The case is Razak v. Uber Technologies Inc, U.S. District Court
for the Eastern District of Pennsylvania, No. 2:16-cv-00573.

reuters