No Delay of Labor Board’s Look Into Uber

     OAKLAND, Calif. (CN) — In a blow to Uber, a federal magistrate said she will decide whether the ride service company must release information to the National Labor Relations Board about whether it misclassifies drivers as independent contractors.
     U.S. Magistrate Judge Kandis Westmore on Friday denied Uber’s request to stay an application by the labor board demanding it comply with two subpoenas for information on its relationship with all current and former drivers.
     The labor board wants the information so it can investigate multiple complaints drivers have filed against Uber throughout the United States accusing it of violating the National Labor Relations Act.
     Because Uber can only have violated the act if the drivers were employees, the labor board says it must determine whether Uber drivers are indeed employees or if — as Uber contends — they are independent contractors. The board says it can’t make that determination unless it has access to information on all drivers.
     Reclassifying drivers as employees would mean paying drivers a minimum wage and contributing payroll taxes to the government, eating into Uber’s profits.
     “The [labor board’s] need to decide whether drivers are employees for the purposes of the act necessitates an investigation, so the board has the information required to make that determination,” Westmore said in her order.
     In two separate lawsuits filed in San Francisco and Los Angeles in September 2015, Uber drivers Catherine London and John Billington accuse Uber of violating the National Labor Relations Act by requiring them to sign arbitration agreements waiving their right to file or participate in class actions against it.
     Drivers then filed unfair labor practice actions against the company in New York, Chicago, Phoenix, Kansas City, Missouri, Newark, New Jersey, and Tampa, Florida, prompting the labor board to consolidate the cases in California and investigate drivers’ employment status in order to issue decisions.
     In subpoenaing nationwide information from Uber, the labor board only referenced the London and Billington suits.
     Uber has refused to comply with the subpoenas, arguing that it need only provide information on London and Billington, which it says it has done.
     “When you look at the subpoenas, the subpoenas were only limited to the two charges,” Uber attorney Robert Hulteng told Westmore at a hearing on Thursday. “We do not believe we have been put on notice that this is a nationwide investigation under every licensing agreement Uber has with drivers.”
     Uber had asked Westmore to stay the proceedings pending approval of an up to $100 million settlement in a similar class action — O’Connor et al. v. Uber Technologies, Inc., arguing that the withdrawal of London and Billington’s charges under that settlement and their agreement that they are contractors would moot the labor board’s enforcement action.
     However, U.S. District Judge Edward Chen denied preliminary approval of the O’Connor settlement later Thursday, finding that it was neither fair nor adequate and noting that the court had received “numerous” objections to it by both individuals and attorneys representing drivers in other California suits.
     Addressing Uber’s contentions on Thursday, National Labor Board Relations Board attorney Carmen Leon told Westmore that even though the labor board filed its subpoenas in California, and regardless of the fate of the California charges in O’Connor, it has made clear to Uber that it requires nationwide information to investigate the employment status of drivers.
     “The [California] charges set in motion the investigation, but it’s not limited to these two individuals,” Leon said. “We would still need nationwide information regardless of where the subpoenas were filed.”
     In her order, Westmore agreed.
     “Since the classification issue exists independently of the two charges, and charges are pending in other regions, Uber would suffer no greater hardship if it is required to comply now,” she wrote Friday. “Uber has not identified any way in which the outcome in O’Connor would affect the investigation of the threshold determination.”
     According to a March opposition filed by Uber, the labor board has subpoenaed 107 interrogatories and 34 documents on the company’s policies regarding driver onboarding, training, monitoring and payments, as well as information on transportation and surge pricing, rider feedback, algorithms within the Uber application and its arbitration agreements.
     Westmore will issue a final ruling on the labor board’s enforcement application without further briefing or oral argument, according to the order.
     Hulteng is with Litter Mendelson in San Francisco.

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