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Uber Is Now Facing A Much Bigger Lawsuit

Uber Is Now Facing A Much Bigger Lawsuit
[Photo: Flickr user Sakeeb Sabakka]

Uber makes software–it’s a technology company. Any threat to this model threatens to turn Uber into a transportation company, which is a much less lucrative venture.

So far, most legal hiccups over the company’s workers–who provide their own cars, gas, schedules, and benefits–have pertained only to specific drivers, such as when the California Labor Commission ordered the company to pay more than $4,000 to a driver it ruled had been misclassified as an independent contractor.

On Tuesday, a U.S. district judge granted Uber drivers class-action status in a lawsuit that claims they were incorrectly categorized as contract workers–which means that misclassification may now apply to tens of thousands of drivers in California. If successful, the suit could influence the structure of all sorts of companies that use an Uber employment model, many of which have already started converting contractors to employees.

In July, Uber filed a 52-page motion opposing the class-action status, which included notes from 400 drivers who praised the job for offering them flexibility and independence.

[via Reuters]

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