17 ms·

Exactly. Independent contractors set their own pricing. If Uber would allow the drivers to set their rates and then "hire" who they felt was best for them (an

by nemo44x 11y ago

Exactly. Independent contractors set their own pricing. If Uber would allow the drivers to set their rates and then "hire" who they felt was best for them (and then markup the price to the customer for their own profit) only then would the drivers be in control of payment. This is how every other independent contractor works.

viscanti 11y ago
It's a different situation though. I've never seen any employee ever working for two companies in the same "shift". I see lots of Uber drivers taking Lyft trips. Riders set the rates with demand based pricing and drivers choose which one gives them the best opportunity at each trip request. That's a unique situation, so a comparison to "every other independent contractor" misses the point here.
- deathhand 11y ago
  Riders do not set the rates of "demand based pricing". There is a set floor price for a car ride with uber. If no one is riding the price is still set in stone. Increasing prices based upon arbitrary percentage utilization does not make it a 'free market'.
  - jacobr1 11y ago
    The idea would be for drivers to in some way set the price - not riders.
  - zaroth 11y ago
    Rates are variable, and drivers choose when to drive. I've taken several rides where the driver only works during "surge" hours. What am I missing here?
    - dragontamer 11y ago
      Drivers didn't set the rate. Ebay for instance, the suppliers set the prices. Amazon Marketplace: the seller sets the prices (not Amazon). Uber sets the prices, NOT the free market.
      - ahallock 11y ago
        You're misusing free market. If the gov had set Uber's prices, you'd be correct. This is just Uber's model (regardless of the whole employer/contractor debate). Another competitor is free to come up with a different model where driver's can set the rate.
        dragontamer 11y ago
        https://en.wikipedia.org/wiki/Free_market https://en.wikipedia.org/wiki/Free_market > A free market is a market system in which the prices for goods and services are set freely by consent between vendors and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority. Uber is a price setting monopoly, the "sole authority" of the price within the Uber "marketplace". Consumers do NOT have any ability to change the price. Nor do any of the Uber drivers. Taxis never were a free market either. But at least they didn't pretend to be one like Uber does.
        ahallock 11y ago
        You're speaking as if Uber exists in a vacuum with no competitors. And consumers do have the ability to change the price, though not directly. They could go with a taxi, use Lyft, ride a bike, take a bus, buy a car, etc--all factors that influence the demand and thus price for such services.
        dragontamer 11y ago
        Lets select "this spot" as the primary arguing point, okay? Uber has one job. Connect riders with drivers. The "libertarian" solution is to provide a marketplace where drivers can sell their services to riders. Drivers can compete against each other by raising or lowering prices, while riders can compete against each other by similarly increasing or decreasing the bid. Uber pretends to do this, but with a distinct difference. Uber sets all the prices. Therefore, Uber is anything BUT a free market. Maybe you don't get it because you haven't been paying attention to Uber marketing. But I'm not claiming that Uber has no competitors. What I'm saying is within Uber's "marketplace" of "independent contractors", the drivers and riders are in fact helpless to Uber's pricing whims. Uber is NOT a free market. But they are trying to market themselves as one. This is a distinct reason why Uber drivers have been declared to be employees.
- Retric 11y ago
  It’s more common than you might think. A common example is jobs where 80% of the time they just need someone there, and then someone does piecework at the same time. EX: A night watchman who's also writting essays. Also, Uber actively discourages this by penalizing drivers who skip to many fares, which suggests they really don't want you to do this.
  - dnautics 11y ago
    Yeah but the night watchman isn't working for a competitor simultaneously.
    - mnx 11y ago
      You could be a night's watchman at an Amazon warehouse, and write stuff for Barnes and Noble, I don't think anybody would care.
  - deleted 11y ago
    [deleted]
  - fragmede 11y ago
    At some point, Uber promised to pay a minimal hourly wage so if there were no passengers requesting rides, drivers would still make (a bit of) money. The resulting scam was to sign in as a driver, then just sit on your couch, skipping fares while still making a non-zero amount of money. When Uber caught on, they added the penalty.
  - quadrangle 11y ago
    I believe that's actually illegal even if common to work on a second job at your first job. Don't quote me, I'm not sure. Anyone know more?
    - copperx 11y ago
      Obviously it depends on the job.
    - __z 11y ago
- Canada 11y ago
  Yeah, it's a new and interesting situation. And I'm sure Uber will appeal. But assuming this turns out to be final... As an employer Uber can set shifts for its employees and ban them from taking jobs from anywhere else while on shift. I wonder what Uber's new privileges with respect to its workers will cost. What benefits are California employers required to pay? Paid vacation? Pay in lieu of notice for termination without cause? Employment insurance contributions? Social security contributions? It's all going to be a moot point in the end. Transport automation is coming.
  - nemo44x 11y ago
    Transport automation is indeed coming. This is even worse for Uber as their main asset right now is their network of drivers. When transport automation is mainstream (still pretty far away) these services will create a race to the bottom as the barrier to entry is very low. Bigger wallets than Uber can price them out.
    - zaroth 11y ago
      Barrier to entry absolutely is not low with transport automation, and network effect will prevail. Rest assured Uber will happily ditch their drivers for computers at the first possible opportunity. They are investing heavily in this in fact. Uber's biggest asset is the installed customer base. Uber's drivers are technically their biggest liability... as this ruling well demonstrates!
      - s73v3r 11y ago
        No, Uber's biggest liability is their management not understanding the law, as this ruling demonstrates.
        CamperBob2 11y ago
        Hardly. The only way you can possibly launch something like Uber is to adopt the "Act first, apologize later" model. Companies like Uber face problems most of us can't even imagine, such as regulatory capture by the incumbent taxi industry. Yes, Uber plays dirty, but to some extent I think they have to, because it's a dirty game.
- dragontamer 11y ago
  > demand based pricing A misnomer. Uber sets the prices, not the market. Uber can market the concept as much as it wants, but it doesn't change the fact that Uber sets the prices and therefore, no free market really exists.
  - ahallock 11y ago
    I think you're confused about what a free market is. Uber is competing against other ride sharing services, and Uber cannot set the price of those services.
    - ahallock 11y ago
      Why the downvotes? While you may argue that most countries have only a semblance of a free market, Uber does indeed have competitors and is operating under market pressure. Riders don't set the rates, no... but I'm not sure what that has to do with a free market.
      - rcthompson 11y ago
        They're not saying that Uber doesn't operate in a free market. They're saying that the competition between drivers within Uber for rides whose prices are fixed by Uber does not constitute a free market.
        ahallock 11y ago
        I suppose it makes sense when applied just to Uber, but it seems misleading. Actors in a free market system will have different models that in isolation would be not so free. I thought free market deals with aggregates.
        hoopd 11y ago
        Since Uber sets prices for a large portion of the market they operate in they have monopoly power and it's therefore not a free market. Uber's at 46% market share in major U.S. markets[0], since taxi's are regulated locally and Uber is setting prices for almost half the market nationally Uber is arguably the #1 regulatory power in the U.S. personal transportation sector. [0] - http://www.forbes.com/sites/andrewbender/2015/04/10/ubers-astounding-rise-overtaking-taxis-in-key-markets/ http://www.forbes.com/sites/andrewbender/2015/04/10/ubers-as...
- s73v3r 11y ago
  "It's a different situation though." No, it isn't. There isn't anything special or unique about Uber that says they should be exempt from existing law. "Riders set the rates with demand based pricing" No, they really don't. I have no ability as a user to state how much I'm willing to pay for a trip.
  - stephengillie 11y ago
    Wouldn't that be a neat app option - put in your destination & fare (i.e. $11) and wait for a driver to agree to it.
    - deleted 11y ago
      [deleted]
- __z 11y ago
  Some jobs are just "sit around unless something goes wrong, then handle the situation." Something going wrong being exceedingly rare. I knew someone who worked at a grocery store that was 24/7. Except they did close on Christmas, New Years, and Thanksgiving. The store's insurance was for a 24/7 operation - which meant that someone had to be in the store even those 3 times a year it was closed. So my friend's job 3 times a year was just to sit in an empty store by himself. Just to comply with the insurance policy. I knew someone who was a master control operator for a TV station for the overnight shift. He told me his job was "make sure the TV doesn't go off the air" which ended up being that he was on the internet and watching TV his whole shift since the TV broadcast very rarely malfunctions. (I don't know if this is usual or not for a master control operator)
  - modfodder 11y ago
    I worked as an editor on overnight TV news broadcasts (for the early morning newscasts). Since most of the early news was a recast of the previous night I typically only had about an hour or two of work. That left 6-7 hours of watching tv, surfing the internet (this was in the late 90s so much less net and slower as well), reading, etc.
- amyjess 11y ago
  Another thing to keep in mind is that Uber drivers set their own hours. A real employee who just works when they feel like working wouldn't last long.
fweespeech 11y ago
Indeed. After this, all the maids-as-a-service companies that use the same model will need to change or risk getting hit as well. [e.g. Homejoy]
dnautics 11y ago
I don't feel like setting prices is the hallmark of independent contracting. Mechanical Turk, for example, the price is (rightfully) set by the problem setter. Perhaps amazon would find it necessary to comply with your judgment by obscuring the price as a 'bid' and effectively require the turker to guess how much the problem setter is willing to pay, creating market inefficiency,reducing transparency, and potentially being more exploitative (amazon pockets the difference if the turker lowballs it)
- tdaltonc 11y ago
  The point about price setting isn't that it must be the driver/turk. It's just that it can't be uber/amazon.
- pyvpx 11y ago
  I have no idea how Mechanical Turk works, however the end result in this situation would be the same. The independent contractor is allowed to choose the price by accepting tasks priced acceptably. the IC still "sets" the price they are willing to work for by only entering into agreements for work where they agree on the price being offered.
  - dnautics 11y ago
    That's not a good analogy if you want to argue drivers are not ICs. The independent driver is allowed to quit driving if Uber sets the prices too low. The driver "sets" the price by only logging on when he agrees to the price that Uber has set.
    - s73v3r 11y ago
      The ability to quit doesn't mean a thing. Everyone, regardless of whether they're an IC or an employee, technically has the ability to quit.
    - bsder 11y ago
      > The independent driver is allowed to quit driving if Uber sets the prices too low. But then the driver loses the ability to see when the price goes back up. If you are "ON" the Uber app, you are required to accept the Uber price, or you get penalized. At no point can you say, "I am willing to accept this price which is lower than Uber." nor can you say "I am not willing to accept a fare below this price for this distance."
deleted 11y ago
[deleted]
nsxwolf 11y ago
Many taxi companies are actually dispatching outfits that license their branding. If you want to drive with their branding and receive their dispatch services and customers, you abide by their rules and pricing. You're an independent contractor, not an employee. How is that different than Uber?
- rorykoehler 11y ago
  If that is the case Uber drivers will have to become licensed taxi drivers. Uber conveniently circumvented this on the argument that they are a sharing/collaborative economy startup, in turn saving themselves lots of money and gaining an unfair competitive edge. They can't use this argument as they have already cornered themselves in this regard.
- sanderjd 11y ago
  Can they subcontract once they license the branding? If so, see point (6) of the thread starter comment. If not, I wonder if point (5) applies in that making licensing decisions is a "managerial" type thing to do. Seems hazy though, and it very well might be that it's no different than Uber, and those companies could be similarly ruled against. Lots of companies come up with schemes to treat employees as contractors, with varying degrees of success.
- smileysteve 11y ago
  Uber's outcome on this case does not mean that there are no other companies that have not been discovered that are mis-categorizing employees, if anything, it's the opposite: Uber is mis-categorizing employees, so it's highly likely that other companies are too.
  - __z 11y ago
    http://www.dol.gov/whd/workers/misclassification/pressrelease.htm http://www.dol.gov/whd/workers/misclassification/pressreleas...
- learnstats2 11y ago
  A taxi company that operates this way is at least close to the bar of having employees. You don't mention whether the drivers are allowed to subcontract work or not: if not, I'd be confident the drivers would be legally classified as employees. This may simply not have been tested in court (or not in any newsworthy case). If you keep a small number of independent contractors happy enough, they won't split hairs over this issue.

by nemo44x 11y ago

viscanti 11y ago

It's a different situation though. I've never seen any employee ever working for two companies in the same "shift". I see lots of Uber drivers taking Lyft trips. Riders set the rates with demand based pricing and drivers choose which one gives them the best opportunity at each trip request. That's a unique situation, so a comparison to "every other independent contractor" misses the point here.

deathhand 11y ago
Riders do not set the rates of "demand based pricing". There is a set floor price for a car ride with uber. If no one is riding the price is still set in stone. Increasing prices based upon arbitrary percentage utilization does not make it a 'free market'.
- jacobr1 11y ago
  The idea would be for drivers to in some way set the price - not riders.
- zaroth 11y ago
  Rates are variable, and drivers choose when to drive. I've taken several rides where the driver only works during "surge" hours. What am I missing here?
  - dragontamer 11y ago
    Drivers didn't set the rate. Ebay for instance, the suppliers set the prices. Amazon Marketplace: the seller sets the prices (not Amazon). Uber sets the prices, NOT the free market.
    - ahallock 11y ago
      You're misusing free market. If the gov had set Uber's prices, you'd be correct. This is just Uber's model (regardless of the whole employer/contractor debate). Another competitor is free to come up with a different model where driver's can set the rate.
      - dragontamer 11y ago
        https://en.wikipedia.org/wiki/Free_market https://en.wikipedia.org/wiki/Free_market > A free market is a market system in which the prices for goods and services are set freely by consent between vendors and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority. Uber is a price setting monopoly, the "sole authority" of the price within the Uber "marketplace". Consumers do NOT have any ability to change the price. Nor do any of the Uber drivers. Taxis never were a free market either. But at least they didn't pretend to be one like Uber does.
        ahallock 11y ago
        You're speaking as if Uber exists in a vacuum with no competitors. And consumers do have the ability to change the price, though not directly. They could go with a taxi, use Lyft, ride a bike, take a bus, buy a car, etc--all factors that influence the demand and thus price for such services.
        dragontamer 11y ago
        Lets select "this spot" as the primary arguing point, okay? Uber has one job. Connect riders with drivers. The "libertarian" solution is to provide a marketplace where drivers can sell their services to riders. Drivers can compete against each other by raising or lowering prices, while riders can compete against each other by similarly increasing or decreasing the bid. Uber pretends to do this, but with a distinct difference. Uber sets all the prices. Therefore, Uber is anything BUT a free market. Maybe you don't get it because you haven't been paying attention to Uber marketing. But I'm not claiming that Uber has no competitors. What I'm saying is within Uber's "marketplace" of "independent contractors", the drivers and riders are in fact helpless to Uber's pricing whims. Uber is NOT a free market. But they are trying to market themselves as one. This is a distinct reason why Uber drivers have been declared to be employees.
Retric 11y ago
It’s more common than you might think. A common example is jobs where 80% of the time they just need someone there, and then someone does piecework at the same time. EX: A night watchman who's also writting essays. Also, Uber actively discourages this by penalizing drivers who skip to many fares, which suggests they really don't want you to do this.
- dnautics 11y ago
  Yeah but the night watchman isn't working for a competitor simultaneously.
  - mnx 11y ago
    You could be a night's watchman at an Amazon warehouse, and write stuff for Barnes and Noble, I don't think anybody would care.
- deleted 11y ago
  [deleted]
- fragmede 11y ago
  At some point, Uber promised to pay a minimal hourly wage so if there were no passengers requesting rides, drivers would still make (a bit of) money. The resulting scam was to sign in as a driver, then just sit on your couch, skipping fares while still making a non-zero amount of money. When Uber caught on, they added the penalty.
- quadrangle 11y ago
  I believe that's actually illegal even if common to work on a second job at your first job. Don't quote me, I'm not sure. Anyone know more?
  - copperx 11y ago
    Obviously it depends on the job.
  - __z 11y ago
Canada 11y ago
Yeah, it's a new and interesting situation. And I'm sure Uber will appeal. But assuming this turns out to be final... As an employer Uber can set shifts for its employees and ban them from taking jobs from anywhere else while on shift. I wonder what Uber's new privileges with respect to its workers will cost. What benefits are California employers required to pay? Paid vacation? Pay in lieu of notice for termination without cause? Employment insurance contributions? Social security contributions? It's all going to be a moot point in the end. Transport automation is coming.
- nemo44x 11y ago
  Transport automation is indeed coming. This is even worse for Uber as their main asset right now is their network of drivers. When transport automation is mainstream (still pretty far away) these services will create a race to the bottom as the barrier to entry is very low. Bigger wallets than Uber can price them out.
  - zaroth 11y ago
    Barrier to entry absolutely is not low with transport automation, and network effect will prevail. Rest assured Uber will happily ditch their drivers for computers at the first possible opportunity. They are investing heavily in this in fact. Uber's biggest asset is the installed customer base. Uber's drivers are technically their biggest liability... as this ruling well demonstrates!
    - s73v3r 11y ago
      No, Uber's biggest liability is their management not understanding the law, as this ruling demonstrates.
      - CamperBob2 11y ago
        Hardly. The only way you can possibly launch something like Uber is to adopt the "Act first, apologize later" model. Companies like Uber face problems most of us can't even imagine, such as regulatory capture by the incumbent taxi industry. Yes, Uber plays dirty, but to some extent I think they have to, because it's a dirty game.
dragontamer 11y ago
> demand based pricing A misnomer. Uber sets the prices, not the market. Uber can market the concept as much as it wants, but it doesn't change the fact that Uber sets the prices and therefore, no free market really exists.
- ahallock 11y ago
  I think you're confused about what a free market is. Uber is competing against other ride sharing services, and Uber cannot set the price of those services.
  - ahallock 11y ago
    Why the downvotes? While you may argue that most countries have only a semblance of a free market, Uber does indeed have competitors and is operating under market pressure. Riders don't set the rates, no... but I'm not sure what that has to do with a free market.
    - rcthompson 11y ago
      They're not saying that Uber doesn't operate in a free market. They're saying that the competition between drivers within Uber for rides whose prices are fixed by Uber does not constitute a free market.
      - ahallock 11y ago
        I suppose it makes sense when applied just to Uber, but it seems misleading. Actors in a free market system will have different models that in isolation would be not so free. I thought free market deals with aggregates.
        hoopd 11y ago
        Since Uber sets prices for a large portion of the market they operate in they have monopoly power and it's therefore not a free market. Uber's at 46% market share in major U.S. markets[0], since taxi's are regulated locally and Uber is setting prices for almost half the market nationally Uber is arguably the #1 regulatory power in the U.S. personal transportation sector. [0] - http://www.forbes.com/sites/andrewbender/2015/04/10/ubers-astounding-rise-overtaking-taxis-in-key-markets/ http://www.forbes.com/sites/andrewbender/2015/04/10/ubers-as...
s73v3r 11y ago
"It's a different situation though." No, it isn't. There isn't anything special or unique about Uber that says they should be exempt from existing law. "Riders set the rates with demand based pricing" No, they really don't. I have no ability as a user to state how much I'm willing to pay for a trip.
- stephengillie 11y ago
  Wouldn't that be a neat app option - put in your destination & fare (i.e. $11) and wait for a driver to agree to it.
  - deleted 11y ago
    [deleted]
__z 11y ago
Some jobs are just "sit around unless something goes wrong, then handle the situation." Something going wrong being exceedingly rare. I knew someone who worked at a grocery store that was 24/7. Except they did close on Christmas, New Years, and Thanksgiving. The store's insurance was for a 24/7 operation - which meant that someone had to be in the store even those 3 times a year it was closed. So my friend's job 3 times a year was just to sit in an empty store by himself. Just to comply with the insurance policy. I knew someone who was a master control operator for a TV station for the overnight shift. He told me his job was "make sure the TV doesn't go off the air" which ended up being that he was on the internet and watching TV his whole shift since the TV broadcast very rarely malfunctions. (I don't know if this is usual or not for a master control operator)
- modfodder 11y ago
  I worked as an editor on overnight TV news broadcasts (for the early morning newscasts). Since most of the early news was a recast of the previous night I typically only had about an hour or two of work. That left 6-7 hours of watching tv, surfing the internet (this was in the late 90s so much less net and slower as well), reading, etc.
amyjess 11y ago
Another thing to keep in mind is that Uber drivers set their own hours. A real employee who just works when they feel like working wouldn't last long.

fweespeech 11y ago

Indeed. After this, all the maids-as-a-service companies that use the same model will need to change or risk getting hit as well. [e.g. Homejoy]

dnautics 11y ago

I don't feel like setting prices is the hallmark of independent contracting. Mechanical Turk, for example, the price is (rightfully) set by the problem setter. Perhaps amazon would find it necessary to comply with your judgment by obscuring the price as a 'bid' and effectively require the turker to guess how much the problem setter is willing to pay, creating market inefficiency,reducing transparency, and potentially being more exploitative (amazon pockets the difference if the turker lowballs it)

tdaltonc 11y ago
The point about price setting isn't that it must be the driver/turk. It's just that it can't be uber/amazon.
pyvpx 11y ago
I have no idea how Mechanical Turk works, however the end result in this situation would be the same. The independent contractor is allowed to choose the price by accepting tasks priced acceptably. the IC still "sets" the price they are willing to work for by only entering into agreements for work where they agree on the price being offered.
- dnautics 11y ago
  That's not a good analogy if you want to argue drivers are not ICs. The independent driver is allowed to quit driving if Uber sets the prices too low. The driver "sets" the price by only logging on when he agrees to the price that Uber has set.
  - s73v3r 11y ago
    The ability to quit doesn't mean a thing. Everyone, regardless of whether they're an IC or an employee, technically has the ability to quit.
  - bsder 11y ago
    > The independent driver is allowed to quit driving if Uber sets the prices too low. But then the driver loses the ability to see when the price goes back up. If you are "ON" the Uber app, you are required to accept the Uber price, or you get penalized. At no point can you say, "I am willing to accept this price which is lower than Uber." nor can you say "I am not willing to accept a fare below this price for this distance."

deleted 11y ago

[deleted]

nsxwolf 11y ago

Many taxi companies are actually dispatching outfits that license their branding. If you want to drive with their branding and receive their dispatch services and customers, you abide by their rules and pricing. You're an independent contractor, not an employee. How is that different than Uber?

rorykoehler 11y ago
If that is the case Uber drivers will have to become licensed taxi drivers. Uber conveniently circumvented this on the argument that they are a sharing/collaborative economy startup, in turn saving themselves lots of money and gaining an unfair competitive edge. They can't use this argument as they have already cornered themselves in this regard.
sanderjd 11y ago
Can they subcontract once they license the branding? If so, see point (6) of the thread starter comment. If not, I wonder if point (5) applies in that making licensing decisions is a "managerial" type thing to do. Seems hazy though, and it very well might be that it's no different than Uber, and those companies could be similarly ruled against. Lots of companies come up with schemes to treat employees as contractors, with varying degrees of success.
smileysteve 11y ago
Uber's outcome on this case does not mean that there are no other companies that have not been discovered that are mis-categorizing employees, if anything, it's the opposite: Uber is mis-categorizing employees, so it's highly likely that other companies are too.
- __z 11y ago
  http://www.dol.gov/whd/workers/misclassification/pressrelease.htm http://www.dol.gov/whd/workers/misclassification/pressreleas...
learnstats2 11y ago
A taxi company that operates this way is at least close to the bar of having employees. You don't mention whether the drivers are allowed to subcontract work or not: if not, I'd be confident the drivers would be legally classified as employees. This may simply not have been tested in court (or not in any newsworthy case). If you keep a small number of independent contractors happy enough, they won't split hairs over this issue.