By Linda Chiem
Law360, New York (September 9, 2016, 6:02 PM ET) — The Ninth Circuit’s ruling that ex-Uber drivers suing the company over background checks must fight it out in individual arbitration, not the courts, deals a body blow to a host of high-profile wage-and-hour class actions where drivers are accusing the ride-hailing giant of misclassifying them as independent contractors, experts say.
The three-judge panel’s much-anticipated Sept. 7 decision largely affirming the validity of Uber Technologies Inc.’s arbitration provisions applies to just two proposed class actions from ex-drivers who claimed that Uber performed background checks without their authorization…. “Uber not having to deal with these cases on a class basis is beneficial to them, but it’s likely to potentially dissuade some of these plaintiffs from moving forward and certain attorneys from taking these cases,” said Michael Landen, a partner at Kluger Kaplan Silverman Katzen & Levine PL who specializes in labor and employment litigation. “Uber is this giant and now you have lawyers that will have to decide if they want to dip their toe in the water when there’s not nearly as much upside.”
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U.S. District Judge Edward M. Chen’s refusal to preliminarily sign off on the $100 million deal — $84 million of which was a lock for drivers while the rest was contingent on the ride-hailing giant launching…
The problem of classifying a worker as an employee or an independent contractor took on new life in the latest lawsuit against ridesharing company Uber brought by several Tampa-based drivers.
How do they comply with murky laws and regulations about classifying workers in an era of so much change in the workplace?
“Certainly, there’s been an uptick in these types of lawsuits,” said Michael Landen, a partner with Kluger Kaplan Silverman Katzen & Levine, who specializes in labor and employment law. Landen, who represents a large transportation company whose drivers are suing for overtime pay, regularly counsels business clients on this issue.
“If there is a close call, we tell them to treat them as an employee to be safe or make sure people are working less than 40 hours a week,” he said.
In the Tampa suit, four drivers from Hillsborough County are seeking class action status in federal court in the Middle District of Florida against Uber Technologies Inc. They are challenging, “Uber’s uniform policy of willfully misclassifying its drivers as independent contractors, when, in fact, each such driver is and/or was an employee of Uber,” they said in the suit.
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There are two simple ways to prevent unwanted legal claims from interrupting the fun: 1) limit alcohol consumption, and 2) have procedures in place to ensure office policies remain intact. For example, companies can choose to refrain from serving alcohol entirely, or offer drink tickets to regulate alcohol consumption by employees. In addition, when choosing a venue for the holiday party, it is important to keep in mind the access employees have to public transportation to avoid drinking and driving. Employers should also consider offering reimbursements for taxis, Uber or other services that offer employees alternatives to impaired driving. By encouraging employees to make good decisions, employers can set an expectation for employees to follow that will help ensure a safe and fun party.
Maintaining office policies during holiday parties is also very important. An email reminder prior to the party reminding everyone to adhere to office policies is a good idea. In addition, members of management should especially adhere to company policies since others will likely follow suit.
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Uber drivers in Florida will be considered independent contractors rather than employees, the Florida Department of Economic Opportunity determined Thursday in a victory for the app-based ridesharing company.
The order reverses an earlier state decision and marks Florida’s stance in a debate facing government agencies and courts across the country as Uber becomes ubiquitous.
“Technology is allowing hundreds of thousands of people to go into business for themselves,” DEO Executive Director Jesse Panuccio wrote in his decision. “Those in business for themselves may not have the same guarantees and benefits of those in the employ of others, but there are many other benefits of being your own boss. … Technological advances are opening up that dream to many more people, and we should not malign (or perhaps misclassify) that trend as worker misclassification.”
An independent contractor designation means the San Francisco-based company can avoid paying drivers’ unemployment benefits, workers’ compensation and other employee-related costs such as hourly wages.
The classification is also central to the company’s business model, allowing drivers to set their own hours and use other ridesharing apps such as Lyft.