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A California Ruling Just Challenged Uber's Entire Business Model

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(Bloomberg) -- California’s labor commissioner said an Uber driver who connects with customers through the company’s app must be considered an employee, a decision that strikes at the heart of its business model. Bloomberg's Emily Chang reports on "Bloomberg West." (Source: Bloomberg)

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California’s labor commissioner said an Uber Technologies Inc. driver who connects with customers through the company’s app must be considered an employee, a decision that strikes at the heart of its business model.

San Francisco-based Uber, like other “sharing economy” startups, has built a business around a flexible car fleet piloted by people it contends are independent contractors. If Uber’s drivers were treated as employees, the company would be required to guarantee them a minimum wage, compensate them for mileage and pay into social security.