Uber Loses Case Against Driver. Will they be Employees? Will it Matter in a Few Years?

An unwritten rule of the “sharing economy” is that no one’s an employee. Employees mean taking out taxes, paying for worker’s comp, insurance and benefits that are all so last century, bro.

The darling of that sharing economy, Uber, lost a fight against the California Utilities Commission in a court in its home turf of San Francisco. The commission found that Barbara Ann Berwick was, in fact, an employee and not the contractor that Uber argued she was.The total damage — $4,152 in expenses and interest.

That’t not a lot for a company that’s asking for, and getting, $2 billion in credit from banks (there’s a lot of money to be made in sharing, apparently). However, Uber (and the rest of the ride-share industry) dealing with drivers as employees could make a serious dent in its valuation.

Uber’s response was predictable:  “It’s important to remember that the number one reason drivers choose to use Uber is because they have complete flexibility and control. The majority of them can and do choose to earn their living from multiple sources, including other ride sharing companies.”

The ruling only deals with the relationship between Uber and Berwick, not all of its drivers. But the precedent is now there, and there’s no lack of similar lawsuits against the company and other ride-sharing startups.

Of course all of this may be moot in the near future, as Uber seems dedicated to replacing its pesky human drivers who need “shelter” and “food” with robot cars that run 24/7 and don’t know the meaning of if the word “union” and “holiday”.

Via Ars Technica. Photo by Alper Çuğun/flickr.