Judge denies Uber's motions in case brought by limousine drivers

By Dawn Geske | Aug 15, 2016

PHILADEPHIA – A mega transportation service and its drivers are in a lawsuit in which the drivers allege they are actual employees of the company and not independent contractors.

Uber faces a lawsuit filed against it by the drivers in its UberBlack limousine service operating in Pennsylvania. In their complaint, the drivers claim they are actual employees of the company and not independent contractors under the Fair Labor Standards Act (FLSA) and the state’s wage regulations. They also claim that Uber violated its fiduciary responsibility by launching the UberX program as a competitor to the UberBlack service.

Uber asked U.S. District Court for the Eastern District of Pennsylvania Judge Michael M. Baylson to recommend arbitration and to stay the pending court decision. Both motions were denied, as the UberBlack plaintiffs had opted out of arbitration in a clause that the company provided in its contract.

“The Uber drivers had clearly opted out of the arbitration provision, so it’s pretty conspicuous that that’s what they’ve done,” Lauren Fuiman Cell, associate at Fisher Phillips, told the Pennsylvania Record.

“It doesn’t mean they are opining on whether they didn’t receive their claims. They clearly opted out of the arbitration provision.”

The plaintiffs and around 240 other UberBlack drivers had opted out of the arbitration provision in the contract that was provided as part of Uber’s Technology Services Agreement. This was a revision provision released to drivers in December 2015.

During the case, Uber argued the opting-out of the provision was nullified by a decision in three cases heard in California by U.S. District Court Judge Edward M. Chen, regarding arbitration agreements. Baylson found that because the plaintiffs in the Pennsylvania cases opted ,out of the arbitration provision there was no agreement between the drivers and Uber for arbitration and further found the stay appeal not appropriate.

The California cases didn’t matter in the decision.

“With everything going on in California with Judge Chen’s decision, it may have been an easy way for the judge to say with all that’s going on, I’m not going to really opine on this right now, but he didn’t because it didn’t have anything to do with what’s going on in the Pennsylvania decision,” Cell said.

“I was not surprised by it. I would like to see further how it goes or even if he gets to that point deciding on whether the independent contractors are to be employees, but with all these other cases that question may not even be decided.”

The case has not examined yet whether the UberBlack drivers can be considered employees of Uber or if they shall remain independent contractors for the company. The outcome of the case could have an impact on employers in Pennsylvania that have independent contractors working for them, as it would examine their worker classifications.

“I think it would be wise for Pennsylvania employers to go through and see how they classify their workers and whether their classification decisions make sense,” Cell said. “Also, in light of the FLSA regulations, it makes sense for Pennsylvania employers, altogether, to go back and re-evaluate their classifications of employees.”

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