SAN FRANCISCO (CN) – A federal judge ruled that a class of California Uber drivers can proceed with claims that the mobile ride-hailing service misclassified them as independent contractors and withheld their tips.
“This decision is a major victory for Uber drivers,” plaintiff attorney Shannon Liss-Riordan said of the 65-page ruling from U.S. District Judge Edward Chen. “It will allow thousands of Uber drivers to participate in this case to challenge their misclassification as independent contractors, as well as to attempt to recover the tips that Uber advertised to customers are included in the fare but are not in fact distributed to the drivers.”
Chen found that that the class of drivers, numbering some 160,000 in California, were able to show that Uber exercises enough control over their driving schedules, performance and pay – along with a unilateral right to terminate a driver without cause – to merit certification.
“There can simply be no dispute that Uber does not let any of its drivers negotiate their compensation – fares are unilaterally determined by Uber,” Chen wrote. “Uber’s uniform and unilateral right to control its drivers’ compensation is important common proof that bears directly on the class members’ work status.”
The 2013 lawsuit brought by former drivers claim they were misclassified as independent contractors and therefore required to pay for their own gas, vehicles and maintenance. They also say Uber falsely tells riders that a 20 percent gratuity is included in the fare, but fails to pass along the full share of tips to drivers.
It’s now up to a jury to decide their employment status.
At a hearing last month, lead Uber attorney Theodore Boutrous told Chen that a large number of Uber drivers don’t want to be reclassified as employees, and that lead plaintiffs in the case aren’t typical of the class.
Chen rejected this argument, writing, “There is simply no basis in the record supporting Uber’s claim that some innumerable legion of drivers prefer to remain independent contractors rather than become employees.”
In a statement, Boutrous said he planned to appeal Chen’s decision to the Ninth Circuit. As in his argument before Chen last month, he noted Tuesday that there really is no “typical” Uber driver because the flexible nature of the job lends itself to variability.
“The mountain of evidence we submitted to the court-including the declarations of over 400 drivers from across California-demonstrates that two plaintiffs do not and cannot represent the interests of the thousands of other drivers who value the complete flexibility and autonomy they enjoy as independent contractors,” Boutrous said.
But Chen tossed the class’ request to certify its gas and maintenance reimbursement claims, along with its request to add subclasses of third-party transportation drivers.
In an email, Uber spokesperson Jessica Santillo said the company was pleased that Chen pared the class down.
“While we are not surprised by this court’s ruling, we are pleased that it has decided to certify only a tiny fraction of the class that the plaintiffs were seeking,” she said. “We’ll most likely appeal the decision as partners use Uber on their own terms, and there really is no typical driver – the key question at issue.”
Still, Liss-Riordan said about 2,000 drivers around the country have contacted her Boston firm, Lichten & Liss-Riordan. While Chen excluded drivers in other states for now, he may consider granting certification in the future.
“We have received many inquiries from Uber drivers around the country who want to participate in the case,” she said, adding that while Chen restricted the class to California driver’s only in an earlier ruling “if we are successful for California drivers, we intend to appeal the ruling that limited the case to California and will seek reimbursement for expenses, as well as tips that were not distributed to Uber drivers, around the country.”
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