Uber Drivers: Employees or Independent Contractors
The Florida Department of Economic Opportunity recently issued a final order determining that two Uber drivers were independent contractors rather than employees and, thus, not entitled to unemployment compensation. This is in contrast to rulings in California and Oregon which have found that Uber drivers are employees entitled to unemployment compensation and other benefits of employment.
The California Labor Commission relied on an appellate case wherein taxicab drivers were found to be employees, and found Uber drivers were akin to taxicab drivers as “[Uber is] in the business to provide transportation services to passengers. Plaintiff did the actual transporting of those passengers. Without drivers such as Plaintiff, Defendant’s business would not exist.”
The DOE rejected that approach as inconsistent with Florida law and old-fashioned for failing to recognize changes in society. The order states: “Technological advances like the internet and smart phones have provided new platforms for middlemen, and new services abound–like Ebay, StubHub, Expedia, Amazon Marketplace, and Airbnb. None of these would be in business without the sellers who use the platform, but that does not mean the sellers are automatically employees of the platform company.” And, “We need not break new legal ground or upend economic progress by transforming middlemen into employers.”
Whether drivers are employees or independent contractors is a big financial deal for Uber who in some states is responsible for paying unemployment compensation and other employment related taxes on its drivers, and in other states, like Florida, is not. While the DOE order says the law and the agreement between Uber and its drivers is “straightforward,” that remains debatable given states’ division on this issue.