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I agree that there certainly could be an argument towards classifying drivers as employees. The fact that the app would not function without drivers is definite

I agree that there certainly could be an argument towards classifying drivers as employees. The fact that the app would not function without drivers is definitely a meaningful one, though it also raises troubling questions over whether Ebay sellers (for example) should also be classified as employees. Like you said, it's a multi-pronged and complicated test. I actually think Uber could meet a majority of the IRS factors.[1] Namely: 1. Instructions: Uber does not instruct drivers about when, where, or how to drive. 2. Training: by most reports, Uber provides no training to drivers. (In fact, this is an argument which Uber detractors often use against it.) 3. Services Rendered Personally: as far as I know, Uber doesn't forbid you from hiring your friend to drive your car around with your Uber account open. (HIRING, SUPERVISING, AND PAYING ASSISTANTS might also apply here.) 4. Set Hours of Work: You can drive whenever you want. 5. Full Time Required: You can only drive a few hours a week. 6. Doing Work On Employer's Premise: This test is somewhat less applicable, but Uber doesn't require their drivers to (for example) come to a company HQ at the beginning of their shift. 7. Payment By Hour, Week, or Month: The bulk of driver payments depend on miles driven for customers, not hours "worked." 8. PAYMENT OF BUSINESS AND/OR TRAVELING EXPENSES: Uber does not compensate drivers for any of their (substantial) expenses. 9. FURNISHING OF TOOLS AND MATERIALS: Drivers provide all their own equipment. 10. SIGNIFICANT INVESTMENT: This is arguable, but many drivers are known to buy new cars just to drive for Uber. 11. REALIZATION OF PROFIT OR LOSS: This is definitely plausible. If drivers don't keep a firm grasp on their expenses or spend too much time driving around looking for riders, they can definitely suffer a loss. 12. WORKING FOR MORE THAN ONE FIRM AT A TIME: Uber drivers often simultaneously work for Lyft or other ridesharing services. This isn't cut-and-dry and we shouldn't treat it as such. [1] https://www.mdc.edu/hr/Operations/AFS/IRSFactorTest.pdf https://www.mdc.edu/hr/Operations/AFS/IRSFactorTest.pdf

gamblor956 11y ago
1. Instructions: Uber instructs drivers on how to use the app to manage fares, and how to use the app to navigate routes. Generally, the use of other navigational apps was not permitted. 2. Training: Uber trains drivers in how to use their app. 3. Uber forbids drivers from having friends in the car and are expected to behave like livery drivers. 4. (Drivers can work whenever.) 5. (Drivers do not need to work full time.) 6. Drivers are required to display an Uber tag in their windshield while driving, (but are not required to begin and end their work "shifts" at any particular location). 7. Drivers are paid out of Uber's revenues, and not by the customer. This is obvious from the way that Uber prepares its financial statements, wherein all payments from customers are treated as its revenues, and driver's cuts as COGS. (On financial statements, employees are COGS, contractors are generally other expenses.) 8. (Uber does not compensate drivers for their expenses) except for tickets, impound fees, and fines incurred while driving for Uber. 9. Uber provides an app, a windshield decal, navigation services, payment processing services, and deposit services. 10. (Drivers provide their own cars.) 11. (Drivers can incur a loss looking around for riders.) This is actually a big point at the international level when determining whether one company is independent of the other financially, but it generally isn't as much of a factor at other levels. 12. (Drivers work for multiple services.) The balance favors treating drivers as employees. Indeed, one of the most important factors is that Uber itself characterizes the drivers' income as its own on its financials and tax returns. That will definitely hurt it when the IRS, the same agency that audits the tax returns, needs to make a determination about classifying the drivers.
- thaumasiotes 11y ago
  I feel like you completely missed the point of #3. Does Uber forbid drivers from subcontracting? There'd still be one driver in the car, it just wouldn't be the Uber account holder.
- mahyarm 11y ago
  #1 I see drivers use other nav apps all the time. Uber just provides integrated navigation, but I'm pretty sure it's not required. The uber app didn't have navigation for quite a while actually. #6 is calfornia regulation, not an uber/lyft/whoever requirement. I don't know how it's like elsewhere. #9 I would compare uber to current taxi independent contractors, which have been standard operating procedure for decades. The taxi driver rents a taxi car with it's attached taxi medallion for a few hundred dollars a day. Anything they make after that is their money. But since the fee is usually very high, they have to work 12 hours day to make something approaching a living. I'm fairly certain the card terminals and the taxi company phone dispatch services come with that rental.
bad_user 11y ago
> 1. Instructions: Uber does not instruct drivers about ... how to drive Whatever gave you that impression? Uber has strict rules about how drivers should behave with customers, or about the maintenance of their car. For example drivers are not allowed to be aggressive in traffic (like taxi drivers), they are not allowed to talk with the client unless the client shows interest in talking, they can't smoke in their car and they are not allowed to reject orders, otherwise they'll suffer a pay cut. I've talked with multiple drivers that confirmed the above. I also once complained to Uber about a driver that called me to convince me to cancel my order and they replied that the driver was scolded. I have the response in my email to prove it. As a disclaimer, I'm talking about Uber from Romania, not from the US, but it's the same story, drivers being hired as contractors.
- pbreit 11y ago
  I suppose that's possibly true in Romania (I doubt it, except for the smoking). It's certainly not true in the US (I drive with Uber and Lyft).

gamblor956 11y ago

1. Instructions: Uber instructs drivers on how to use the app to manage fares, and how to use the app to navigate routes. Generally, the use of other navigational apps was not permitted. 2. Training: Uber trains drivers in how to use their app. 3. Uber forbids drivers from having friends in the car and are expected to behave like livery drivers. 4. (Drivers can work whenever.) 5. (Drivers do not need to work full time.) 6. Drivers are required to display an Uber tag in their windshield while driving, (but are not required to begin and end their work "shifts" at any particular location). 7. Drivers are paid out of Uber's revenues, and not by the customer. This is obvious from the way that Uber prepares its financial statements, wherein all payments from customers are treated as its revenues, and driver's cuts as COGS. (On financial statements, employees are COGS, contractors are generally other expenses.) 8. (Uber does not compensate drivers for their expenses) except for tickets, impound fees, and fines incurred while driving for Uber. 9. Uber provides an app, a windshield decal, navigation services, payment processing services, and deposit services. 10. (Drivers provide their own cars.) 11. (Drivers can incur a loss looking around for riders.) This is actually a big point at the international level when determining whether one company is independent of the other financially, but it generally isn't as much of a factor at other levels. 12. (Drivers work for multiple services.) The balance favors treating drivers as employees. Indeed, one of the most important factors is that Uber itself characterizes the drivers' income as its own on its financials and tax returns. That will definitely hurt it when the IRS, the same agency that audits the tax returns, needs to make a determination about classifying the drivers.

thaumasiotes 11y ago
I feel like you completely missed the point of #3. Does Uber forbid drivers from subcontracting? There'd still be one driver in the car, it just wouldn't be the Uber account holder.
mahyarm 11y ago
#1 I see drivers use other nav apps all the time. Uber just provides integrated navigation, but I'm pretty sure it's not required. The uber app didn't have navigation for quite a while actually. #6 is calfornia regulation, not an uber/lyft/whoever requirement. I don't know how it's like elsewhere. #9 I would compare uber to current taxi independent contractors, which have been standard operating procedure for decades. The taxi driver rents a taxi car with it's attached taxi medallion for a few hundred dollars a day. Anything they make after that is their money. But since the fee is usually very high, they have to work 12 hours day to make something approaching a living. I'm fairly certain the card terminals and the taxi company phone dispatch services come with that rental.

bad_user 11y ago

> 1. Instructions: Uber does not instruct drivers about ... how to drive Whatever gave you that impression? Uber has strict rules about how drivers should behave with customers, or about the maintenance of their car. For example drivers are not allowed to be aggressive in traffic (like taxi drivers), they are not allowed to talk with the client unless the client shows interest in talking, they can't smoke in their car and they are not allowed to reject orders, otherwise they'll suffer a pay cut. I've talked with multiple drivers that confirmed the above. I also once complained to Uber about a driver that called me to convince me to cancel my order and they replied that the driver was scolded. I have the response in my email to prove it. As a disclaimer, I'm talking about Uber from Romania, not from the US, but it's the same story, drivers being hired as contractors.

pbreit 11y ago
I suppose that's possibly true in Romania (I doubt it, except for the smoking). It's certainly not true in the US (I drive with Uber and Lyft).