Uber Technologies Inc. faced sharp questioning from a judge in its bid to block its drivers from banding together in a push for better pay and benefits.
U.S. District Judge Edward Chen in San Francisco asked Thursday how the ride-sharing startup can argue that all its drivers are independent contractors at the same time as it says they have varying work arrangements.
“Is there some tension, an inconsistency, for Uber to argue as it has that every single driver is an independent contractor, without exception, and yet to say there are also such material variations” in their experiences that they can’t sue as a group, Chen said.
At stake in the case is Uber’s “drive whenever you have time” motto, a flexible arrangement that’s also at the heart of the broader sharing economy. Many of these companies avoid the costs of traditional employment by relying on workers classified as independent contractors who connect with customers through apps. The Uber lawsuit, the most advanced of similar legal challenges, argues the model violates labor laws.
If the drivers win employee status, they would be entitled to unemployment and workers’ compensation as well as the right to unionize. They may also be able to seek reimbursement for mileage and tips and other damages.
Uber wants to keep the case limited to the handful of drivers who filed their complaint two years ago. The plaintiffs seek to proceed on behalf of all the 160,000 drivers working for the company in California.
The company argues that because it has 17 different licensing agreements with drivers, they don’t have enough in common for the lawsuit to advance as a class action.
The judge said while the language differs among the agreements, they all have similar termination provisions, showing that the company exercises control over drivers more like they are employees than contractors.
“It seems to me that every one of them enables Uber to terminate without cause,” Chen said. “That’s how I see it.”
Uber’s lawyer argued that the termination clauses are only one factor in assessing employment classification.
“There are many different variations that would have to be considered here that go to the right of control” of Uber’s drivers, lawyer Theodore Boutrous told Chen.
The plaintiffs’ attorney, Shannon Liss-Riordan, urged the judge to consider dividing the drivers into smaller groups or trying the case in phases if he’s not comfortable letting it go forward as one single class action.
Chen said he’ll issue a ruling later.
The case is O’Connor v. Uber Technologies Inc., 13-cv-03826, U.S. District Court, Northern District of California (San Francisco).