An employee is someone who works according to the instructions of an employer, with a limited degree of freedom on the part of the employee. [25] The OECD`s 2018 Interim Report defines Uber as a pay-as-you-go ride-sharing company, noting that it is « a digital platform that creates value by bringing drivers and passengers together so they can make a ride on a pay-as-you-go basis. It is based on the following main steps. First of all, the rental company recruits drivers with access to their own car. It then centrally orchestrates drivers, monitors e.B their hours of activity and locations to provide a transportation platform. Third, the company is developing a platform, including a mobile app, that will allow passengers to book a ride. Finally, it guarantees the quality of transactions through a verification system where drivers and passengers have the opportunity to assess the quality of the interaction » (loc. cit., pages 66/67). Given these results, Uber says the reclassification would be bad for the company, its customers, but also for drivers. « These facts support the conclusion that drivers, whether or not they purchase a service from the defendants, provide them with services in the ordinary course of the defendant`s business, » the court said. In 2019, Bill AB 5 codified and expanded an ABC test to distinguish employees from independent contractors. Workers are considered independent contractors if: Money.com published a study in 2015 that showed that the average cost of the Lyft trip was $12.53, which can vary depending on the type of vehicle service chosen and the city where the ride takes place.
Lyft also worked during what`s known as « prime time, » where fees increased based on demand. But this controversial feature was replaced in 2019 by « personal power zones » that pay drivers a premium based on location and demand. Uber applies a similar incentive to its drivers. Uber and Lyft have significant interests at stake in this decision. Although publicly traded companies are worth billions of dollars, they still need to become profitable. The COVID-19 pandemic has exacerbated the financial difficulties of carpooling. Uber`s core business of providing rides is down nearly 75 percent. The company continues to generate revenue through its food delivery app, but total sales have dropped by 30%.
Uber has laid off about 6,700 office workers and Lyft has laid off nearly 1,000 employees. [24] Labour law aims to protect workers and guarantee them rights on the basis of their professional status and, in addition to the duties and responsibilities of employers. Tax law generally focuses on collecting money from those who are able to pay to fund government activities. Drivers also have important interests that need to be balanced. Some workers fear that reclassification as employees will deprive them of flexibility and their ability to create their own work schedule. Nevertheless, many believe that they should receive social benefits. For example, Hector Castellanos had an accident while driving for Lyft and missed eight months of work. Because he was an independent contractor — and he wasn`t eligible for workers` compensation — his daughter had to drop out of college to help pay for family expenses. Other drivers report that they often earn less than the minimum wage and struggle to cover high travel costs. Working as an independent contractor has consequences for many Uber and Lyft drivers. California Superior Court Judge Ethan Schulman said: « These damages are not mere abstractions; They represent real harm to real workers. As a result, many insist that the drivers who are at the heart of carpooling deserve the protection of employees.
As in Prop. 22 UBER argued that working time should be limited to the time elapsed between the acceptance of a request for transport and the completion of the request. Nevertheless, the court ruled that the time the driver spent in the app and was available to users willing to respond was also working time. Now let`s look at a clear victory in yesterday`s election. Uber and Lyft celebrate a big win in California. Voters overwhelmingly opted for ride-hailing companies to continue to treat their drivers in the state as independent contractors rather than employees. NPR Tech correspondent Shannon Bond joins us. Before we begin, we`d like to point out that Uber and Lyft are among NPR`s backers. However, Uber argued that if drivers were to be classified as employees, the company would only have 260,000 full-time driver jobs available, leaving 926,000 drivers unemployed. .
