California’s Labour Commission ruled Wednesday that Uber drivers in the state should be considered employees.
This is a potentially huge blow to the company, as its business model relies on using independent contractors, for whom it does not pay benefits or employment taxes.
The ruling reads, in part, “Defendants [that’s Uber] hold themselves out as nothing more than a neutral technological platform, designed simply to enable drivers and passengers to transact the business of transportation. The reality, however, is that Defendants are involved in every aspect of the operation.”
Other than not owning the cars drivers operate, Uber more or less controls every step of how its company operates. Therefore, California says that makes the people who work under Uber’s rules its employees.
And now that California Uber drivers are employees, it’s time for them to organise. If they want to protect their jobs, they really have no choice.
- In the short term, Uber may start shedding employees it can no longer afford.
- In the medium term, there’s almost definitely a wage pinch coming. Uber has shown that it has little respect for maintaining its fares — it keeps cutting them to the detriment of drivers. The only way that drivers stand a chance of protecting their income is to come at the company as an organised group.
- In the long term, Uber drivers face an automation problem. Driverless cars are coming. Maybe not this decade, but certainly in this lifetime. A union won’t be able to stop that process, but it can be a big help as it happens. Anything human drivers can do to protect their jobs is a good thing.
And Uber drivers, in fact, have actually already started the process toward unionizing.
They already have an interest group, the California App-Based Drivers’ Association (CADA), established in 2014. And the group has met with the Teamsters Local 986 in El Monte, California.
According to the Teamsters last August, “After Uber management flatly refused to sit with members of CADA’s steering committee, and privately stated that it does not, and will not recognise any association that seeks to speak on behalf of drivers, CADA reached out to Teamsters Local 986 for organizational and lobbying assistance.”
Now that California drivers are employees, they have the right to organise under National Labour Relations Act.
And the time to do it is immediately.