In a significant victory for ride sharing service Uber, drivers lost a key federal appeals court decision seeking back pay and status as employees, not independent contractors.
The 9th U.S. Circuit Court of Appeals ruled Tuesday Uber drivers must submit their claims to independent arbitration and dissolved their class action certification.
The panel rejected the drivers’ claim that the contract’s arbitration agreements were unenforceable because they contain class action waivers.
The ruling provides a major victory for the company, which had challenged the drivers’ assertion that they should be treated as employees with all the benefits that would entail.
Two Uber drivers filed the class action in 2013 alleging the company failed to repay them the full amount of tips paid by customers and that it misclassified drivers a independent contractors, thus denying them pay for business expenses such as gas, auto maintenance as expenses.
Trial Judge Edward Chen found the arbitration contract terms unconscionable and thus unenforceable and certified a class of 160,000 drivers in California to pursue their claims.
The appeals court decision overturns Chen’s ruling. The ruling was written by Judge Richard Clifton and joined by Judges Richard Tallman and Sandra Ikuta.
Case: O’Connor v. Uber, No. 14-16078