Oregon labor officials will now begin classifying Uber drivers as employees instead of contractors, according to an advisory opinion released Wednesday.
The Oregon Bureau of Labor and Industries issued the advisory. It states that Uber drives will no longer be considered contractors. The very business model Uber is based on, however, relies on contracting. The ride-sharing company is opposed to the opinion.
“The Oregon Bureau of Labor and Industries issued this opinion without apparently talking to any drivers and after a brief five minute phone call with Uber that came out of the blue,” Uber said in a prepared statement provided to The Daily Caller News Foundation. “Unsurprisingly, it’s full of assertions that are plain wrong.”
The advisory opinion does not have implications for ongoing litigation. The opinion simply serves as a notification that the agency will begin looking at cases differently going forward. A spokesman for the agency told TheDCNF it will apply its opinion equally to Uber and its competitors. The agency uses an economic reality test to determine employment. The test looks at how much control the company has over its contractors as well as how much it invests in regular operations.
“Oregon’s worker protections are in place for a reason,” State Labor Commissioner Brad Avakian said in a statement. “When corporations misclassify an employee, the worker is denied basic protections such as the right to be paid on time and in full. It also creates an unfair playing field for other employers who pay employment taxes, minimum wage and workers’ compensation insurance.”
Advances in digital technologies allow companies like Lyft and Uber to use contracting in unique ways. Companies make digital platforms where individuals create their own business ventures. The new business model is most often referred to as the sharing economy.
“It’s disappointing that a public body would have so little regard for the facts,” Uber continued. “50 percent of drivers using Uber drive fewer than ten hours a week, less than even a traditional part-time job.”
The advisory is not the first time the sharing economy has been the subject of criticism. Opponents say it’s too unregulated and unfair to workers. Democratic presidential hopefuls Hillary Clinton and Bernie Sanders are among those who condemn the model. Officials at the Department of Labor spoke out against it as well.
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