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New York State Labor Review Board Finds Some Uber Driver Are Actually Employees


Recently, the New York State Labor Review Board made a ruling and determined that three former Uber drivers were actually employees, rather than independent contractors, for unemployment insurance purposes.  (Perhaps most importantly, this ruling applies to those three drivers and "similarly situated" drivers). For those that have been following the ongoing fight in the "gig economy" in regard to whether these workers are actually employees or independent contractors (as they have mainly been classified), this ruling could mark a major turning point in this struggle.

The question now turns to what Uber (and other related gig economy companies) will do.  Uber's official statement so far is that it disagrees with the ruling and is reviewing its options to determine how to proceed.  If Uber chooses to contest the New York State Labor Review Board's ruling, it will have to do so in court.

Should this ruling remain in place and Uber decide to abide by it, the potential ramifications could be massive.  For instance, Uber's workforce in New York City is believed to be more than 65,000.  If Uber drivers were classified as employees, rather than independent contractors, Uber would become the largest for profit private employer in the city.  Consequently, Uber would be required to begin making unemployment insurance contributions for its drivers.  The long term costs to Uber could be exponential, not even considering whether they would have to begin doing so elsewhere in the country.

Something tells me this is just the tip of the iceberg as other workers in the gig economy will point to this ruling as "precedent" for their related employee vs. independent contractor disputes.  In the meantime, it will be interesting to see what, if anything, Uber chooses to do to contest the decision.


 

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