Uber drivers filed a class action lawsuit that claimed the company saved itself more than half a billion dollars each year by misclassifying drivers in California as contractors rather than employees. That classification means drivers are not entitled to be reimbursed for their expenses that Uber should have to pay for, like for gas and vehicle maintenance. The lawsuit also challenges Uber’s former practice of telling passengers that the gratuity is included, even though (until last year) drivers were not getting tips.
The lawsuit claimed Uber’s “below-cost and anti-competitive pricing” took 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,” wrote the plaintiff’s lawyers. “Uber uses these savings to price its services far below their cost. Predatory pricing strategies have been a feature, not a bug, of Uber’s business model.”
Uber is still continuing to vigorously defend itself in this lawsuit and is attempting to reverse the trial court’s certification of the case as a class action. Uber is also trying to require drivers to pursue individual arbitrations if they want to recover any damages for the wage law violations alleged.
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