Uber Driver Sues Company Over Compensation Issues

Uber Driver Sues Company Over Compensation Issues

Susan Orr for www.theindianalawyer.com

An Uber driver from Marion County has filed a class-action complaint against the ride-on-demand company, claiming that Uber treats its drivers like employees but classifies them as independent contractors in order to skirt labor laws.

The driver, William Scroggins, filed the suit Thursday in U.S. District Court in Indianapolis. The suit was filed on behalf of Scroggins and other Uber drivers statewide, and it asks the court to allow the case to proceed as a class-action suit.

The lawsuit argues that Uber drivers miss out on protections like expense reimbursement, overtime pay, and rest and meal breaks because they are classified as independent contractors. At the same time, the suit says, Uber also sets fares, monitors drivers and disciplines or terminates those who fail to meet standards.

“It’s exercising so much control over how they do their jobs that they should be paid as employees,” said attorney Vess Allen Miller of Cohen & Malad, the Indianapolis law firm representing Scroggins.

As an independent contractor, Scroggins claims, he has to pay for his own fuel, car repairs, lease payments and insurance.  These expenses, Scroggins says, sometimes mean his Uber earnings fall below Indiana’s minimum wage of $7.25 per hour.

In one example cited in the suit, Scroggins earned $99.59 in fares for nearly 9 hours of driving for Uber. But he spent about half of that on job-related expenses, which dropped his earnings to the equivalent of $5.95 per hour.

Another part of the suit concerns gratuities. Uber passengers pay their fares via a smartphone app, and the company tells passengers they don’t need to tip. This message, the suit says, implies that driver tips are built into the fare—but drivers never receive those gratuities.

“Were it not for Uber’s misrepresentations regarding gratuities, riders would have left a tip for drivers as is customary in the car-service industry,” the suit says.

Uber is a San-Francisco-based company whose smartphone app connects drivers with those seeking rides. It entered the Hoosier State in 2013 when it launched service in Indianapolis. Uber now also serves other parts of the state including Bloomington, Fort Wayne, northwestern Indiana, West Lafayette and parts of southeastern Indiana that belong to the Louisville metro area.

The Indiana suit is among a number of similar suits being filed around the U.S.

In April, Uber agreed to pay up to $100 million to settle class-action suits in California and Massachusetts.

The Indiana suit, Miller said, is “pretty much in keeping with the same arguments that have been made in California and Massachusetts.”

The technology news website techcrunch.com reported that a nationwide class-action suit similar to the California and Massachusetts cases was filed last month in Illinois.

In response to the Indiana suit, Uber issued a statement via email.

“Nearly 90 percent of drivers say the main reason they use Uber is because they love being their own boss. As employees, drivers would have set shifts, earn a fixed hourly wage, and lose the ability to drive with other ridesharing apps—as well as the personal flexibility they most value,” an Uber spokesperson wrote.

The Indiana suit says there are likely “thousands” of Uber drivers in Indiana who could become part of the class, but the exact number is unknown because that information is held by Uber. Miller said he expects that Uber will release those records as part of the lawsuit, which will give the plaintiffs access to driver information.

The suit seeks damages in an amount to be determined via a jury trial. It also seeks to have the plaintiffs classified as Uber employees; and a court order requiring Uber return “wrongfully kept” gratuities to its drivers.