Many drivers choose a life on the road as independent contractors because of the promise of freedom and the ability to work for themselves. In reality, some California drivers may be misclassified and should perhaps be employees instead of contractors. Independent contractors from Uber and Lyft are hoping that a jury will be able to settle their employment dispute over their classification status.
A class action lawsuit was filed on behalf of all the drivers in California who work for the companies. According to the complaint, the drivers believe that they are misclassified as independent contractors. As contractors they are not eligible for minimum wage or overtime nor are they being reimbursed for work expenses. They are also ineligible for unemployment insurance and many other benefits. Their status can also affect liability insurance in the event of accidents.
Two federal judges were unable to make a decision on the status because the drivers do not fit perfectly into either category. Like independent contractors, the drivers are able to select who they take as passengers and can set their own hours. On the other hand, they are like employees because they can be fired at will, and their interactions with customers are determined by company protocol. They are even restricted to which radio stations they can have on in their vehicles.
Since the California drivers do not seem to fit perfectly into either class of worker, this employment dispute could be a benchmark for the future. The decision in this case may even require a new classification to be created to better fit the growing number of workers who fall outside of the existing categories. If the jury rules that the drivers are in fact employees, they may be awarded lost wages and overtime and begin receiving all of the associated benefits.
Source: sfgate.com, "Court: Juries to decide if state Uber, Lyft drivers are employees", Bob Egelko, March 11, 2015