A labor court judge in the state of Minas Gerais, Brazil has found that an Uber driver there is an employee of the company, taking the debate over the classification of drivers to another country. The Brazilian newspaper Zero Hora reports that the decision is the first in Brazil to recognize Uber as an employer of drivers. According to Reuters, the judge “ordered Uber to pay one driver around 30,000 reais ($10,000) in compensation for overtime, night shifts, holidays and expenses such as gasoline, water and candy for passengers.” Uber announced that it will appeal the decision. The ruling only applies to a single driver, but could open the door to more challenges.
Brazilian news portal G1 notes that the judge applied a multi-factor test for employment status under Brazilian law. Key factors included that a) users are assigned a driver by Uber, unable to select from options; b) Uber (not the passenger) pays drivers at the end of each week after withdrawing a percentage, thus going beyond simple mediation of passenger-driver business; c) transport is Uber’s primary business, as partially evidenced by its investment in automobiles vehicles; and d) Uber drivers are submissive to the company, forced to comply with strict rules in order to drive for the company.
Zero Hora also emphasized that the judge found that drivers were encouraged to drive regularly despite flexibility, and that Uber engaged in a hiring process by approving drivers.
Happy Valentine’s Day! Those celebrating should be careful not to run affront of labor and employment law. The Richmond Times-Dispatch notes that “when a gift is received unexpectedly from a co-worker on Valentine’s Day of all days, it raises the creep level to litigation status.” Their special correspondent advises readers to keep their celebrations out of the workplace.
Donald Trump’s selection for Secretary of Labor, Andrew Puzder, continues to face difficulties with his nomination. According to CNN, four Republican senators – “Susan Collins of Maine, Lisa Murkowski of Alaska, Tim Scott of South Carolina and Johnny Isakson of Georgia” – are withholding support for Puzder pending his confirmation hearings. Republican leaders will lobby the four senators, but if they cannot be swayed Trump may replace Puzder.
After a long campaign, a little over 3,000 Boeing workers in Charleston will finally vote tomorrow on unionization. The New York Times reports that the election represents a key test of the strength of organized labor in the early days of Trump’s presidency. Boeing was enticed to open the plant in South Carolina in large part because of reduced labor costs relative to their operations in the Seattle area, partly driven by the lack of unionization.
In other news, graduate students at colleges and universities continue to mount union organization campaigns. Organizers and students continue to make their case at Duke University and the University of Maryland, for example.
2017 could be a tough year for labor unions at the state level. According to NPR, Kentucky has become the nations’s 27th “right-to-work” state, and Missouri and New Hampshire could join it in February. New Hampshire would become the first “right-to-work” state in the Northeast. Advocates in New Hampshire claim that “right-to-work” will entice businesses to relocate to the state, while opponents assert that “right-to-work” creates free rider problems and constitutes political reprisal against unions for supporting Democrats.
At the federal level, things might not be much better. The Washington Examiner reports that two Republicans will introduce national “right-to-work” legislation tomorrow. President Trump’s purported support has “right-to-work” advocates optimistic, despite previous failures in Congress.
With respect to President Trump’s agenda, unions are prepared to fight. Per Bloomberg BNA, “labor groups representing immigrants, women, blacks, Latinos and Asian-Americans vowed collective action against President Donald Trump at a rally in Washington Jan. 27” and “[Representatives from AFL-CIO constituency groups] promised grass-roots organizing with regional union chapters to protect immigrants and union workers and to ensure sanctuary cities remain.”
Major players in the gig economy have responded to President Donald Trump’s action to bar refugees and citizens of seven Muslim countries from entering the United States.
Most controversially, in the face of a 1-hour strike at New York’s John F. Kennedy International Airport yesterday by the union representing 19,000 New York taxi drivers in protest of Trump’s Muslim ban, Uber suspended surge pricing. In effect, Uber broke the strike despite their claim that it wasn’t their intent to do so. Both Buzzfeed and Slate report on a movement by consumers to cease using Uber and delete the application in response.
Uber also released a email sent to employees by CEO and co-founder Travis Kalanick, in which he stated Uber is “working out a process to identify…drivers [affected by Trump’s executive order] and compensate them pro bono during the next three months to help mitigate some of the financial stress and complications with supporting their families and putting food on the table.” Kalanick serves on President Trump’s business advisory group.
Uber’s chief rival Lyft, on the other hand, released a much stronger statement. Per Mashable, in an email to consumers entitled “Defending Our Values,” co-founders Logan Green and John Zimmer called Trump’s order “antithetical to both Lyft’s and the nation’s core values,” noting they stand firmly opposed to the action. Most notably, Green and Zimmer stated that Lyft is “donating $1,000,000 over the next four years to the ACLU to defend our constitution.”
Airbnb, for its part, “has offered free accommodation to people left stranded by President Donald Trump’s travel restrictions,” according to the BBC.
Donald Trump’s nominee for Labor Secretary, Andrew Puzer, may be having second thoughts about taking the job following intense criticism of his nomination. CNN reports that Puzder “has voiced second thoughts in recent days, because of a relentless barrage of criticism from Democrats, labor unions and other liberal groups, a business ally and GOP sources tell CNN.” Puzder is apparently discouraged by the required paperwork and attacks on him by Democrats, organized labor and worker advocates. At the earliest, Puzder’s confirmation hearing would be next month. In response to the report, Puzder tweeted that he looks forward to his hearing.
Meanwhile, Trump’s plans to increase American jobs through increased American production of goods continues to generate significant skepticism. With respect to production of iPhones, according to technology site BGR, “if iPhone factories came to the US, you can be sure that robots would be the only ones getting more jobs.” Any increased American production would reflect that the “relative cost of skilled labor in the US and China is such that it’s cheaper to build a robot than it is to hire one US worker to replace one Chinese worker in the supply chain.”
Education increasingly defines the ability of Americans to succeed economically. The Associated Press notes that “Americans with no more than a high school diploma have fallen so far behind college graduates in their economic lives that the earnings gap between college grads and everyone else has reached its widest point on record.” College-educated workers have disproportionally benefited from new jobs and wage increases following the 2008-09 Great Recession, and are far more in demand by employers. The education gap is most significant for white men, but is true across the board, and developing the skills of non-college-educated workers is critical.
The Recorder reports that Uber has “successfully persuaded a private arbitrator that a California driver for the transportation company is an independent contractor, not an employee, in the first arbitration in the United States to test that issue.” While drivers continue to challenge Uber’s mandatory arbitration agreements in court, the arbitrator’s decision represents the outcome of the first of what could become many individual challenges by drivers asserting proper classification as employees, if arbitration agreements are enforced.
The public agency in Switzerland charged with providing obligatory on-the-job accident insurance, Suva, has determined that an Uber driver in that country is an employee – meaning Uber will have to pay social security contributions on that driver’s behalf. Swiss broadcaster SRF reports that the agency found that the Uber driver’s case clearly had the characteristics of an employment relationship under Swiss law. Like in the United States, Uber’s “comprehensive control” over drivers was critical to the determination of employee status, since Uber drivers cannot set their own prices and face consequences for deviating from Uber rules and directives.
According to TechCrunch, Uber stressed that the decision pertains to an individual driver and that it plans to appeal, although the decision can serve as precedent and Switzerland’s Federal Council may create new rules for technology service providers.
The decision in Switzerland represents the third significant European challenge to Uber’s classification of drivers as independent contractors. In October, a British employment tribunal found that Uber drivers are not self-employed independent contractors, but rather Uber workers. And in November, the European Court of Justice heard arguments in a pending case asserting Uber should be classified as a transportation service subject to strict European labor laws.