Regulations

Suit Claims Uber Saves Huge Sum By Misclassifying Drivers

Posted on September 11, 2018
The new suit claims that Uber fails to pay drivers for breaks as required under California law and shirks tax obligations, including the 6.2% employer Social Security tax, the 1.45% employer Medicare tax, and unemployment insurance contributions. (Creative Commons photo)


The new suit claims that Uber fails to pay drivers for breaks as required under California law and shirks tax obligations, including the 6.2% employer Social Security tax, the 1.45% employer Medicare tax, and unemployment insurance contributions. (Creative Commons photo)

A new lawsuit against Uber Technologies Inc. claims the company may save more than half a billion dollars each year by misclassifying drivers in California as contractors rather than employees.

The lawsuit, brought on behalf of Studio City-based livery service Diva Limousine Ltd., claims Uber’s “below-cost and anticompetitive pricing” has taken its toll on a proposed class of pre-arranged transportation companies in California and others across the country who have affiliate relationships with them.

“Each day that Uber misclassifies its primary workforce, it steals wages from drivers earning below a living wage and gains millions of dollars in unlawful cost savings. Uber uses these savings to price its services far below their cost,” wrote the plaintiffs lawyers at Robins Kaplan and Keller Lenkner in Monday’s 27-page complaint. “Predatory pricing strategies have been a feature, not a bug, of Uber’s business model,” they wrote.

The Recorder/Law.com article here

Related Topics: California operators, employee vs independent contractor, labor laws, lawsuits, legal issues, TNCs, Uber

Comments ( 10 )
  • Tony

     | about 12 months ago

    Bijan is a stand up guy. He's the only one who has the guts to put a stop to this uber madness. uber has sucked us dry with there unfair practices and deep pockets. It's about time the someone really stood up to them.

  • See all comments
More Stories
Video

LCT Interview With Chicago Operator Paula DeBiasi

Paula DeBiasi, executive director of the Illinois Limousine & Bus Association and owner-operator of Chicago CoachWorks, talks with LCT contributing editor Jim Luff during the International LCT Show in March for insights on why associations are needed to protect operator livelihoods.