9th Circuit Rules For Uber In Misclassification Case

In a major victory for Uber Technologies, Inc., the Ninth Circuit Court of Appeal reversed a lower court’s ruling, which held that a lawsuit filed by current and former drivers could proceed as a class action. In finding for Uber, the Ninth Circuit ruled that the claims against Uber for misclassifying their drivers as independent contractors must be filed individually as opposed to a class action, thereby dramatically reducing the value of these claims. The Uber drivers alleged that Uber misclassified them as independent contractors, thereby denying the drivers reimbursements, tips, and other protections required for employees. Although the drivers had filed a class action against Uber, they had signed an arbitration agreement that included a class waiver. However, the lower court held that the arbitration agreement was unenforceable, and thus ruled that the case could proceed as a class action. Uber then appealed, and the Ninth Circuit ruled that “[a]s the class certification by the district court was premised on the district court’s determination that the arbitration agreements were unenforceable, the class certification must also be reversed.”  This decision highlights the importance of employers including mandatory arbitration agreements (which have a class waiver) as part of their workplace policies.

For any questions about implementing an arbitration agreement that contains a class waiver for your workplace,  please give us a call at Toll Free 1-562-888-0126 or email sales@yourvirtualhr.com for more information.

Read the Ninth Circuit Court of Appeal’s decision here.