Last week US District Judge Edward Chen, of the Northern District of California, certified a class of up to 160,000 California Uber drivers who could seek mileage and tip reimbursement from Uber. Attorneys for Uber unsuccessfully argued that its relationships with individual drivers were too unique to be represented by a single class of plaintiffs.
Shannon Liss-Riordan, a prolific plaintiffs’ class-action lawyer, has filed lawsuits against Uber, Lyft, Homejoy, Postmates, and Caviar – five of the largest “on-demand” start-ups in the world. She argues Uber gives its drivers employee-like duties while treating them as independent contractors in order to skirt its obligations as an employer. Uber argues it is simply a software platform that connects drivers with people looking for rides.
If Uber drivers are found to be employees, Uber would be required to pay overtime, unemployment insurance, workers compensation, and potentially expenses such as gas and vehicle wear and tear. Start-up advocates fear that this could put many “on-demand” start-ups out of business or prevent new ones from being created due to labor costs.