Uber tells drivers how they can join lawsuit, against Uber "drivers are employees - meaning the app-based ride company must cover expenses - and that Uber stiffs them on tips."

Uber tells drivers how they can join lawsuit, against Uber "drivers are employees - meaning the app-based ride company must cover expenses - and that Uber stiffs them on tips."
http://www.sfgate.com/business/article/Uber-tells-drivers-how-they-can-j...
Carolyn Said

Published 5:33 pm, Friday, June 20, 2014

Uber sent notices to many U.S. drivers this week telling them how to join in a national class-action suit against the ride company.

The suit claims that drivers are employees - meaning the app-based ride company must cover expenses - and that Uber stiffs them on tips.

A federal judge told the San Francisco company that it must contact drivers who have started since August, explaining how to opt out of mandated arbitration, which bars the possibility of a day in court.

Uber added a mandated arbitration clause for drivers last summer just as Boston lawyerShannon Liss-Riordan was filing a class-action suit.

U.S. District Judge Edward Chen of San Francisco said the company must give drivers a chance to reject the clause, and must tell them about the lawsuit.

The suit has two huge charges that Uber will fight tooth and nail.

First, it claims Uber drivers are actually employees, not independent contractors. That would make Uber responsible for their work-related expenses: gas, car maintenance and insurance, among others. Uber says those costs can average $15,000 per full-time driver per year.

"Uber tells drivers how to interact with customers, dress, maintain their vehicles, and what (customer) ratings to get, and it 'deactivates' them, essentially firing them, if their ratings go too low," Liss-Riordan said. She argues that having that much control over drivers makes them employees even though they set their own hours.

Second, the suit delves into tips.

"Uber has misrepresented to the public that a tip is included for drivers and therefor they don't need to tip," Liss-Riordan said. "That is not correct. There is no tip included. So reasonable customers are unlikely to top on top of the fare."

Another tip issue: For a while Uber Taxi added a 20 percent gratuity to fares, but Uber kept half.

Uber did not respond to requests for comment, but previously said the lawsuit was frivolous.

Judge Chen indicated in December that the tips allegation appears valid, but questioned whether drivers would be able to prove that they are employees.

Drivers have 30 days to opt out of mandated arbitration. Retaliation for doing so would be illegal. Information is at www.uberlawsuit.com.

The class-action covers all of Uber's ride services, including Uber Black, UberSUV, Uber Taxi and UberX. The case is at the discovery phase and likely won't go to trial until next year at the earliest.

Carolyn Said is a San Francisco Chronicle staff writer. E-mail: csaid@sfchronicle.comTwitter: @csaid