If you’ve been paying attention to labor law (or more specifically worker classification) in the news or the grumbles of your last Uber driver, you may know that the on-demand driver provider is facing a three-headed monster. It’s not stoplights, stop signs, and lane changes—instead, it’s a mess of more than 70 federal lawsuits against Uber from drivers, passengers, and even the government.
What brought it all on? To start, Uber has classified their drivers (both full and part-time) as contractors, while drivers feel that they’re treated as employees. As things stand today, those drivers are correct—they are employees. That decision has cost Uber $100 million in a settlement in both California and Massachusetts. More settlements and lawsuits are still pending.
The difference between W-2 employees and 1099 independent contractors occupies a grey area. This grey area has become the target of a Department of Labor crackdown. The DOL is dropping the hammer and strengthening its enforcement of worker classification. If they’re not careful, companies could face lawsuits from many angles. If Uber is any indication, that’s not likely to turn out very well.
The bottom line
At PayReel, compliance comes first. We don’t just classify your employees properly, we even pay them properly so that you can hire who you want exactly when you want them. If grey areas aren’t your thing and if the term “lawsuit” makes your heart skip a beat—relax, we got it. Contact us around the clock at 303-526-4900 or email us here.
About the author
PayReel Customer Experience Manager Natalie “The Go Getter” McGinnis recapped 2016’s biggest news in freelancer management to help you prepare for 2017. Nat’s experience in recruitment and customer service set her up for success in providing laser-focused attention and assistance to the PayReel employees and clients who need it the most. Click here to read more of Nat’s Notes and meet the rest of the PayReel team by clicking here!