Uber Class Action Update

For those unfamiliar with Uber, it is essentially an app that connects those needing a ride with Uber-affiliated drivers who are in the area and available to provide a ride. The price of a ride is substantially less than one in a taxi, and thanks to driver background checks, the ability of customers to rate drivers, and the requirement that a vehicle be relatively new and in good condition, the quality of the ride normally exceeds that of a ride in a taxi. Full disclosure: We love Uber and use it religiously.

The popularity of Uber seems to grow exponentially by the day, and there are apparently 150,000 Uber drivers worldwide. One of the benefits to Uber drivers is that they can make their own schedule by signing on to provide rides when they want to work and signing off when they decide to finish their shift. Reportedly, driving for Uber can be lucrative, with hourly wages reaching between $30 and $43 an hour in New York City, for example.

Uber is able to provide this flexibility to its drivers by, among other things, treating them as independent contractors as opposed to regular employees. Recently, however, a class action was filed on behalf of Uber drivers seeking to challenge this practice. According to the informational website created for the class action, the following is the basis for the lawsuit:

Uber drivers have filed a class action lawsuit claiming they have been misclassified as independent contractors and are entitled to be reimbursed for their expenses that Uber should have to pay, like for gas and vehicle maintenance. The lawsuit also challenges Uber’s practice of telling passengers that the gratuity is included and not to tip the drivers, even though you are not getting a tip!!

Unfortunately for Uber, the lawsuit is allegedly valued at $62.5 billion, and a recent ruling by the judge presiding over the case has expanded the class to include “Uber drivers who agreed as part of their contracts to settle disputes in arbitration.” The good news for Uber, though, is that the judge excluded from the class “drivers who work for limo companies—which includes one of the three plaintiffs in the original suit; and individuals who have registered to drive for Uber under a corporate name.”

It will be interesting to see how this one develops. At first glance, this appears to be one of those lawsuits which attempts to criminalize the business model of the defendant. We hope the suit is unsuccessful, as we like the way Uber does business, and we hope that its business continues on.