Oregon Agency Says Uber Drivers Are Employees

By Joanne Deschenaux Oct 20, 2015
LIKE SAVE PRINT
Reuse Permissions

Oregon Bureau of Labor and Industries (BOLI) Commissioner Brad Avakian, in an advisory opinion issued Oct. 14, 2015, said Uber drivers are employees rather than independent contractors because they work for the company’s benefit and they’re economically dependent on the ride-hailing company.

The opinion is not binding. State regulators can only sanction Uber if a driver files a formal complaint and regulators review evidence and legal arguments specific to that person’s situation. The agency admits that “no case relevant to this question has been filed with BOLI” but states that it intends the advisory opinion to be “instructive to all interested parties.”

Six-Factor Test

According to Avakian, drivers are employees under the Oregon economic realities test, which considers six factors:

  • The degree of control exercised by the alleged employer.
  • The extent of the relative investments of the worker and the alleged employer.
  • The degree to which the worker’s opportunity for profit and loss is determined by the alleged employer.
  • The skill and initiative required in performing the job.
  • The permanency of the relationship.
  • The extent to which the work performed by the worker is an integral part of the alleged employer’s business.

The opinion concludes that the six factors “illustrate how Uber drivers are not operating their own separate businesses with the degree of autonomy one expects with an independent contractor. To the contrary, the rigorous hiring process, the highly controlled directions as to how work is to be performed and at what price, the expectation of long-term employment, the insignificant investment of the driver when compared to the massive infrastructure provided by Uber, and the integral nature of the driver’s work to the business are all characteristic of an employment relationship.”

Uber officials disagree with the opinion. In a statement, Uber said BOLI had only a very brief discussion with an Uber manager and no conversations with Uber drivers. Uber contends that many of its drivers don’t even work half-time—and they “value the independence and flexibility: the ability to work whenever and wherever they choose.”

Uber called the opinion “full of assertions that are plain wrong.”

Litigation concerning the status of Uber drivers as employees or independent contractors is pending in California and Pennsylvania.

Joanne Deschenaux, J.D., is SHRM’s senior legal editor.

LIKE SAVE PRINT
Reuse Permissions

SHRM-CP/SHRM-SCP EXAM

The application deadline is October 21

Apply Today

Job Finder

Find an HR Job Near You

SPONSOR OFFERS

Find the Right Vendor for Your HR Needs

SHRM’s HR Vendor Directory contains over 3,200 companies

Search & Connect