Uber Worker Ruling: Significant Legal Implications for Personal Injury Cases
People all over the world use the Uber and Lyft ride-hailing apps to find a driver for hire. Users of Uber and Lyft probably do not stop to wonder about issues such as insurance coverage and whether the driver is an Uber or Lyft employee versus an independent contractor. For answers regarding insurance coverage check the Uber and Lyft websites.
The distinction between employee and independent contractor issue is important in a personal injury case in which an Uber or Lyft driver’s negligence causes catastrophic injuries. If the value of such case exceeds the amount of insurance coverage available from the driver and from the Uber or Lyft excess policy, the attorney for the plaintiff should look to hold the company liable under a theory of respondeat superior. If the driver is an employee rather than an independent contractor of Uber or Lyft, Uber or Lyft is responsible for the employee’s negligence, and their assets may be available to cover a verdict in excess of the insurance coverage. Uber now operates in 150 U.S. cities and 57 countries, and is valued at $41 billion.
Uber is headquartered in San Francisco. The California Labor Commissioner ruled recently that an Uber driver was an employee. The case was about whether the driver was entitled to receive mileage and toll expenses, but it’s holding could be far-reaching if it winds up being heard by the California Supreme Court. The Commissioner’s order found that Uber was involved in “every aspect of the operation,’ including vetting drivers, requiring them to provide personal banking, Social Security and address information, conduction DMV and background checks, and only allowing drivers to use registered cars that are less than 10 years old. These findings of fact would be significant in states where the test of whether one is an employee or an independent contractor hinges on the employer’s power or right to control the means and methods of the employee’s performance.
The issue is not confined to California state courts. In March, a federal judge certified a class action lawsuit involving drivers who contend that they are employees entitled to benefits such as unemployment insurance, workers’ compensation coverage, and healthcare.
Here’s another thing consumers of Uber should know. In the event that you are injured by an Uber or Lyft driver, the companies will try to force you to resolve your claim through binding arbitration. So much for your Seventh Amendment right to trial by jury.
Michael Phelan is a Virginia trial attorney who practices with a special focus on traumatic brain injury (TBI) cases, pharmaceutical and medical device claims, product liability cases, and truck accidents. Michael’s peers have consistently recognized him for his excellence as a trial lawyer, and his clients have praised him for his commitment to deep research, his outstanding communication skills, and his sincerity and dedication.