Uber Faces Potentially Devastating Court Ruling

Jeff Deist writes at Mises Wire:

Uber, Lyft, and similar rideshare companies represent a direct threat to state-controlled taxi cartels and their (increasingly unsellable) medallions. Now a class action lawsuit against Uber has been cleared for a federal court jury in California, alleging that its drivers should be classified as employees rather than independent contractors. If so, Uber potentially could owe millions of dollars in unpaid payroll taxes at both the state and federal levels (not to mention penalties) going all the way back to 2010. This could represent a death blow legal precedent for every company using the rideshare model.

These kinds of suits (ostensibly motivated by drivers who want the “benefits” of being treated as employees) represent judicial revenge by rent-seeking taxi companies. They desperately want to quash maverick rideshare startups, startups that dared provide a market solution to an age-old problem: how to get a taxi in the suburbs.

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12:44 pm on May 20, 2015