Both sides in the Uber misclassification case in California appeared in federal court last Thursday to argue over class action status, according to news reports [1]. Separately, two more gig economy firms opted for going with W-2 workers instead of independent contractors.
In the Uber case, it’s now up to Judge Edward Chen whether to certify the case as class action. The suit, O’Connor et al. v. Uber, et al., involves drivers who claim misclassification as independent contractors. If certified, the suit could include anyone who drove for Uber in California from Aug. 16, 2009, onward, according to court records.
In addition to misclassification lawsuits, Uber has come under fire from others including cab drivers. And Gawker.com, citing internal Uber documents it obtained, reported the ride sharing firm is losing money [2].
Separately, two more gig economy firms reported they will use employees instead of independent contractors. One is meal delivery app Sprig.com.
“This new model allows us to better develop and retain team members who stand behind our mission, and continue to invest in the entire Sprig customer experience,” CEO Gagan Biyani wrote in a blog post [3].
Forbes reported in April that Sprig had a total of $57 million in funding [4].
In addition, Luxe, which lets users hire a person via an app to meet them at a location and park their car, will transition its valet parkers to employees, the company said in a press release.
“As we grow, we have realized the need to assert more direct control over the customer experience and provide our valets with career development opportunities and benefits — none of which are possible within the boundaries of the 1099 model,” Luxe CEO Curtis Lee wrote in a blog post [5].
Tech Crunch reported [6] a $20 million funding round for Luxe back in March.
Other gig economy companies that announced transitions of some independent contractors to employees include Instacart [7] and Shyp [8].