A ruling in the case of a single Uber driver could have much broader implications for the popular ride-hailing service and for companies like it that rely on part-time workers for on-demand services.
The California Labor Commission has ruled that an Uber driver should be considered a company employee, not an independent contractor.
San Francisco-based Uber said the ruling is nonbinding and only applies to one driver. It is also appealing the decision.
The driver, Barbara Ann Berwick, who worked in San Francisco, filed a claim last year saying Uber owed her unpaid wages and other expenses. Uber has long contended that it is a technological platform used by independent drivers and their passengers to arrange and pay for rides.
The commission, however, found that Uber acted like an employer, and the driver, like a delivery person for a pizza parlor, was an employee.
While Uber holds itself out as “nothing more than a neutral technological platform,” it is in fact “involved in every aspect of the operation,” the commission said.
The ruling is among legal challenges facing the company, along with Lyft, another ride-hailing service, from drivers seeking benefits and protections afforded to regular workers.
Currently, these companies treat drivers as independent contractors, which means they don’t have to pay benefits. Classifying the workers as employees could significantly raise the companies’ expenses.