Uber Smacked Down By State Judges

Jim Luff
Posted on August 24, 2016


It depends on who you ask and what state you are in. The fact judges in California and Massachusetts have handed Uber some serious defeats in August indicates the lobbying efforts of the National Limousine Association, New England Livery Association, and Greater California Livery Association may be getting some much needed traction in leveling the playing field. Particularly in the way Uber drivers are classified.

I was part of a team of NLA members who went to visit our elected officials in Washington, D.C. during the NLA Day on the Hill. Our message, repeated throughout the day, was that the limousine industry plays by all of the rules set for employers through the Department of Labor. This includes mandated healthcare coverage, the collection of payroll taxes from the employee, and paying payroll tax for workers. Limo operators are also required to maintain worker's comp policies on their employees to prevent an unnecessary drain on the taxpayer dime for claims with no coverage.

For example, let's say an Uber driver hurts his back lifting luggage at the airport. Uber offers no worker's comp coverage as the Uber driver is an independent contractor. So, when he seeks medical treatment, he must pay out of pocket. If the injury requires physical therapy, prescriptions and follow-up visits, it's unlikely he will have the funds to pay. So guess who pays? That's right, you do!

This is why a federal judge's ruling in San Francisco which rejects Ubers paltry offer to current and past drivers to divvy up $100 million and call it a day has been deemed, "not fair, adequate, and reasonable" by U.S. District Court Judge Edward Chen of the Northern District of California.

Now that its been rejected, Uber faces a payout of closer to $850 million. I don't care who you are or how big you are, $850 million bites hard. The claims against them which total about $850 million include mileage, fuel, tips, overtime and phone usage as the drivers assert they are "employees" working under the direction and control of Uber.

Meanwhile, in Massachusetts, Gov. Charlie Baker signed the most stringent bill in the country regulating transportation network companies (TNCs) that mandates driver background checks, implements insurance requirements, and sets toll rates. It also imposes a 20-cent-per-ride fee that cannot be passed on to the driver or the consumer. The money will ultimately provide financial aid to taxi, livery, and hackney industries that are losing money because of TNCs. Things are finally looking up a little.

Related Topics: California operators, GCLA, Jim Luff, lawsuits, legal issues, Massachusetts operators, National Limousine Association, NELA, Shop Talk blog, TNCs, Uber

Jim Luff Contributing Editor
Comments ( 1 )
  • Anthony

     | about 2 years ago

    Judge Chen understands the law and wages completely. Uber will continue to spend its investors money untill someone decides the buck stops here. 10 billion

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