In California, the independent status of VTC company drivers is endorsed by a court
In the long-term legal battle between it and drivers, Uber can breathe. A California Court of Appeal ruled on Monday March 13 that the law defining the independent status of drivers of VTC companies was not contrary to the Constitution of this western American state.
Uber, its competitor Lyft, and other platforms refuse to consider drivers as full employees, which would mean granting them certain rights, such as unemployment benefits or possible collective bargaining. Associations of drivers and unions, which campaign for the status of employees, had won a first battle in August 2021, when a judge declared Proposition 22 “unconstitutional”because it limited “the power of the assembly” to legislate in the future on this subject. This law approved in a referendum in 2020 devoted paid work to the task, even if it granted drivers some social advantages.
“Today’s decision is a victory for workers and the millions of Californians who voted for Proposition 22”reacted on Monday, Tony West, the legal director of Uber.
The group ardently defends its economic model, the “gig economy”, or the economy paid for by the task, widely adopted, but also widely criticized, in many large cities around the world. Uber has also had to let go of ballast in certain countries, such as in the United Kingdom, where in 2021 it had to grant salaried worker status to its British driverswith minimum wage and paid holidays, a world first for the company.
A net loss of over $9 billion in 2022
In the United States the platform continues to resist. With its competitor Lyft and delivery services, it had spent in 2020 more than 200 million dollars to promote the “yes” to Proposition 22. And three months before the vote, the two Californian companies had threatened to completely interrupt their service in the state, which would have put tens of thousands of people out of work.
Voters had voted 58.6% in favor of the law proposed by the companies. “Drivers across the state said they were happy with Proposition 22, which allows them to enjoy new benefits while maintaining job flexibility through apps”said Tony West on Monday.
The platform for booking vehicles with drivers (VTC) and meal deliveries recorded a net loss of 9.1 billion dollars in 2022, despite a net profit of nearly 600 million dollars in the fourth quarter 2022. Its title took nearly 5% during electronic trading after the close of trading on Monday.