Skip to main content

Uber says drivers aren’t an essential part of its business

Uber’s top lawyer said it would not comply with a California bill that would force it to treat its contract drivers as employees, claiming that drivers are not a core part of the company’s business.

Speaking on a conference call on Wednesday, Uber chief legal officer Tony West pushed back against the newly passed Assembly Bill 5 (AB5), which will require app-based companies in the gig economy to reclassify their workers as regular employees.

Recommended Videos

West said the company doesn’t plan to make the change when the law goes into effect, essentially saying that drivers would remain independent contractors. The bill established what’s called the ABC test to determine who should be classified as an employee, and West says Uber drivers don’t qualify since they aren’t essential to the business.

Please enable Javascript to view this content

“Under that three-part test, arguably the highest bar is that a company must prove that contractors are doing work ‘outside the usual course’ of its business,” he said. ”Several previous rulings have found that drivers’ work is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces.”

AB5, which is expected to be signed into law by Gov. Gavin Newsom, will go into effect on January 1, 2020, and will enable workers to have basic protections afforded to employees, including minimum wage requirements, health benefits, and Social Security contributions.

Uber Chief Legal Officer Tony West
Uber chief legal officer Tony West. Image used with permission by copyright holder

West seemed to claim that Uber isn’t a ridesharing platform at all. We contacted Uber to see if it could give additional context on West’s comments and will update this story if we hear back.

Uber, Lyft, and other gig-based companies with huge legal muscle are likely to challenge the bill, which could fundamentally change the way they do business. Despite West’s insistence that drivers aren’t all important to Uber, the law might mean huge changes for the drivers themselves. They might need to work in shifts instead of whenever they want, or even only be able to work for one app at a time instead of multiple services.

“There would be real changes in the way that drivers interact with the platform, and based on what drivers tell us, they are not changes that they would welcome,” West said.

It’s long been speculated that Uber’s endgame is to get rid of drivers altogether. The company has invested major money into its self-driving car program, known as the Advanced Technology Group. While the company experienced a major setback when one of Uber’s self-driving cars struck and killed a pedestrian in Arizona in March of 2018. The company has since relaunched its self-driving car tests in three cities.

Mathew Katz
Former Digital Trends Contributor
Mathew is a news editor at Digital Trends, specializing in covering all kinds of tech news — from video games to policy. He…
California sues Uber, Lyft to force them to make drivers employees
Uber

California Attorney General Xavier Becerra is suing Uber and Lyft over their alleged misclassification of their workers as independent contractors instead of as employees. 

Becerra filed a lawsuit against the two rideshare companies on Tuesday, saying that they violated California's new Assembly Bill 5 law that requires app-based companies to identify contractors as regular employees of the company. Under the bill, contractors are eligible for basic protections like minimum-wage requirements, health benefits, and Social Security. 

Read more
Uber responds to gig-economy law by testing driver-led bidding system
Uber Driver

Uber drivers in California will be able to set their own fares as part of a new pilot program, which the rideshare company is testing as a response to the state’s new gig-economy law that categorizes individual contractors of a company as employees. 

The Wall Street Journal reports that the company will begin testing the feature starting Tuesday, January 21. Drivers with passengers going to or from the Santa Barbara, Palm Springs, or Sacramento airports can charge their passengers up to five times the regular ride fare. 

Read more
Luke Grimes says Costner’s absence made this easiest season of Yellowstone to film
Luke Grimes leaning on a fence in Yellowstone.

The absence of Kevin Costner from the second half of Yellowstone's fifth season was one of the defining stories of the show's second half. While many fans may have missed Costner and his character, John Dutton, there was at least one member of the cast who thought Costner's absence made filming the show easier.

In an interview with Esquire, star Luke Grimes got candid about filming the final season. “Hopefully, everyone can see that it was time,” he told Esquire. “To be really honest, there was a part of Kevin being gone that meant some of the conflict was gone. Obviously, it didn’t make it super fun to be around. Not pointing any fingers, but it was actually the easiest season we’ve filmed.”

Read more