Court ruling goes against Uber - drivers are employees - at least in California.
http://uk.businessinsider.com/california-labor-commission-rules-uber-drivers-are-employees-2015-6?r=US
The California labor commission has ruled Uber drivers are employees, Reuters reports. The decision was made after a San Francisco driver, Barbara Ann Berwick, filed a claim against the company. The commission sided with her largely because it deemed Uber was "involved in every aspect of the operation."
It's potentially a huge blow to Uber's business model, at least in California......Let's keep in mind that this ruling is only in California. Uber, which was last valued at ~ $50 billion, has more than 1 million drivers world wide. While California is Uber's largest market, the company operates in 311 cities and 58 countries, so this is a small percentage of Uber's global business. If this ruling stays confined to a single state, Uber's problems will be much easier to overcome. Also, this ruling is far from official. This could all be tied up for years in court.
Both Uber and Lyft have been hit with lawsuits from drivers asking to be made official Uber employees. The companies insist their drivers should be independent contractors. By the way, this ruling isn't just a huge deal for Uber and Lyft. There have been a lot of "Uber for X" startups to follow in their wake: $1 billion startup Instacart, for example, has contract workers deliver groceries; $250 million startup Shyp has regular people mail things for customers. If these companies, which are referred to as the 1099 economy, can no longer have independent contract workers, all of their business models are shot.
Read more: http://uk.businessinsider.com/california-labor-commission-rules-uber-drivers-are-employees-2015-6?r=US#ixzz3dL6Y9yHt
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