Uber drivers should legally be considered employees of the company, a state labor judge has ruled.
The decision could open the door to drivers suing Uber all their benefits, meaning that Uber would be on the hook for such worker benefits as overtime and holiday pay and healthcare contributions, not to mention back payroll taxes to the state and federal governments.
Judge Michelle Burrowes said she was basing her ruling on Uber’s behavior toward its drivers, including that it collects data about them when they are logged on.
“Uber took steps to modify the claimant’s behavior, as typical in an employer-employee relationship,” the judge wrote.
“Uber published, and made available to claimants, its code of conduct that placed them on notice of what constituted acceptable behavior and what consequences might attach.”
Driver Jeffrey Shepard had sued the ride-share app company last year, claiming that his expenses and the nickle-and-dime fees that Uber charged him left him making far less than minimum wage over a 40-hour work week.
Uber argued that its drivers are not employees partly because they are allowed to set their own hours.
The company also claimed at the time that driving for the company was never meant to be a primary means of income but instead as a supplement for a full-time job.
But most Uber drivers in New York City do work for the app company full time, according to New York Taxi Workers Alliance Executive Director Bhairavi Desai.
“The message here is simple: If you’re going to control the workers to maximize your profits off their labor, you owe them their rights and benefits under the law,” said Desai.
The ruling means that Uber now owes the state back unemployment insurance for all of its drivers in New York dating all the way back to January of 2014. The amount owed could top $25 million, said a source.
Lawyer Nicole Salk, who represented Shepard and the New York Taxi Workers Alliance, said the case could have very far-reaching consequences for Uber.
“It applies not just to the three Uber drivers in question but to “others similarly situated.” she said. “There is no difference between these drivers and other drivers for Uber. Now Uber will have to make unemployment contributions to the state for these workers and we believe it owes the state contributions for every Uber driver.”
Uber officials said Tuesday that they plan to appeal Burrowes’s decision.
“We are immediately requesting a new hearing and appealing this decision,” said Uber spokeswoman Alix Anfang.
“We are confident we will prevail. The [federal] Department of Labor has already ruled that several drivers are independent contractors, and a federal court has deemed all black-car drivers to be independent contractors.”