Skip to main content

Updated: O'Connor v. Uber (Ninth Circuit Court of Appeals)


Late last month, a three judge panel from the Ninth Circuit Court of Appeals issued a 3 - 0 decision that reversed a class action certification in one of the most closely watched gig economy independent contractor v. employee cases currently pending.  That case, O'Connor v. Uber, revolved around an argument by Uber drivers that the company improperly categorized them as independent contractors rather than employees.  Class certification had been granted back in 2015 and a settlement was almost reached (but ultimately rejected by the judge overseeing the case).  However, the class certification was reversed late last month on the grounds that Uber's arbitration clause prohibited class actions (and therefore mandated individual arbitrations rather than litigation in the court system).

This ruling not only overturned the class certification that involved thousands of California Uber drivers but also reversed a lower court's denial of Uber's motion to compel arbitration in three lawsuits.

It is notable that Uber's likelihood of compelling arbitration appeared to have taken a favorable turn after the United State's Supreme Court's ruling earlier this year in Epic Systems Corp. v. Lewis, in which the Supreme Court issued a 5 - 4 ruling and held that companies can compel employees to waive their right to class actions and instead pursue arbitration for workplace disputes.

After the 3 - 0 decision from the Ninth Circuit, an attorney said that while the decision was expected, a request may be made for an eleven judge appeals court panel to revisit the matter.  In the interim, the thousands of drivers who had their class certification reversed are apparently pursuing individual arbitrations against Uber.

There are a few takeaways here that I want readers to note.  First, while this decision is monumental in the ongoing gig economy independent contractor v. employee fight, this ruling applies only to the states in the Ninth Circuit.  While the decision could be cited elsewhere, Uber drivers in Minnesota, Florida, West Virginia, Vermont, etc. could still choose to continue with a class certification, if they wanted, without this case being binding precedent.  However, Uber drivers in the Ninth Circuit appear to have lost their option to pursue a class action against the company in regard to their worplace disputes (and instead will be required to pursue those claims only through binding arbitration).  As well, the 3 - 0 decision did not definitively stipulate that Uber drivers are independent contractors rather than employees.  This ruling only related to the reversal of the class certification.  With that being said, I would expect employers in the gig economy to point to this decision as further evidence that courts are likely to find the arbitration provisions mandatory and consequently that Uber drivers are correctly identified as independent contractors rather than employees.  Whether this attempted parallel will be successful is debatable.

For the time being, this is a major turning point in the ongoing gig economy independent contractor v. employee fight.



Comments

Post a Comment

Popular posts from this blog

NLRB: Discussion Among Employees About Tip Pooling is Protected Concerted Activity

  This Advice Memorandum from the National Labor Relations Board’s Associate General Counsel, Jayme Sophir, addressed whether employees which discussed and complained about tip pooling at work constituted protected concerted activity. In relevant part, an employer in New York operated a chain of steakhouses.  While tip pooling was in place at these steakhouses, some of the employees objected to it on the grounds that it was not transparent and improperly divided tips among the workers.  Employees were told not to complain or talk to each other about the tip pool and were told that doing so would endanger their jobs.  Despite the employer later attempting to provide some clarity as to how the tips were being divided, rancor still existed among some employees.  At one point, the employees were told by a general manager that some employees that had been talking about the tip pool were “cleared out” and the employer would continue to do so. In the Advice Memorandum,...
Post a Comment
Read more

Breaking: Labor Secretary Rumored to Be Leaving Administration

A few hours ago, word leaked out that Labor Secretary Marty Walsh (“Walsh”) is in the midst of negotiations to head up the NHL Players Union and leave his position at the Labor Department. Walsh, who has served as the sole Labor Secretary under President Biden, has taken part in a labor renaissance of sorts as support for organized labor has increased during his term as Labor Secretary (although the number of workers that have joined a union over the past two years has not grown as mush as some expected.)  He has also overseen the ongoing negotiations with rail workers over a new contract, although that matter is still on shaky ground and playing out as we speak. As for who might step into the vacant Labor Secretary role, there are already rumblings that President Biden should nominate Deputy Labor Secretary Julie Su (a strong labor advocate) or even a progressive like Senator Bernie Sanders.  Until Walsh officially gives his notice, however, I would expect some/many potential...
Post a Comment
Read more

Distance in a Non-Compete Agreement Measured "As the Crow Flies"

Ginn v. Stonecreek Dental Care - Court of Appeals, Twelfth Appellate District of Ohio Facts :  Dr. R. Douglas Martin ("Martin") sold his dental practice to an employee who worked there, Dr. David Ginn ("Ginn").  In doing so, Martin and Ginn signed a contract for the sale which contained a non-compete provision that prohibited Martin from engaging in business "within 30 miles" of the practice for five years starting from October 2010.  While Martin initially stayed on and worked with Ginn for a period, the relationship subsequently deteriorated between the two and Martin went to work for another dental office.  The new dental office was less than 30 miles away when measuring the distance in a straight line.  However, when driving between the offices, the distance was more than 30 miles. Ginn filed a claim against Martin on the grounds that Martin breached the non-compete.   At the trial court level, the court found that "within 30 miles"...
Post a Comment
Read more