Is Uber on the way out? Vicarious Liability in Australia

frowny on 18/06/2015 - 16:29

http://www.news.com.au/finance/business/landmark-us-ruling-d…

From here, it was found that Uber drivers in the US have been ruled to be employees and not individual contractors. Not only does this have ramifications on employee benefits, but the issue of vicarious liability arises in Australia.

Vicarious liability is the idea of law that the employer can be found liable for the wrongs or torts of the employee if they were acting "in the course of their employment", such as assault, stealing from people, etc, the general shadiness that comes from letting nearly anyone drive around - even sexual assault. This opens the floodgates to allow Uber to be sued for wrongs by their drivers.

Discuss?

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Comments

  • LiamF on 18/06/2015 - 17:44
    +1

    This isn't a court case, it's a decision by the California Labour Commissioner…

    So probably nothing. Uber will throw resources at it (because it potentially threatens its business model), the case will eventually be settled out of court, etc etc. Even if they fail on appeal, US precedent doesn't bind Australian courts, so it'd require the entire thing to play out locally anyway.

    • frowny on 18/06/2015 - 18:56

      Just a discussion, it could be likely that they are found to be employees in Australia as well. If they are, would that be damaging enough to Uber's business model that they just bite the dust?

  • azazal on 18/06/2015 - 20:44
    +1

    If you're running under the ATO test they will be deemed contractors - the way I always look at it is breaking it down quite simply - to be a driver you need a car and you need someone to drive it.

    As the individual supplies both they are deemed as contractors.

    The only real circumstances where this would change is if Uber specified that the drivers were to become a partnership, company or trust.

    • grasstown on 19/06/2015 - 23:19

      Aren't Contractors deemed as employees in many circumstances. Particularly where they work solely for one employer. Frequency. Where the employer dictates how they perform their work, what vehicle is used, what service must be provided. That type of thing. I didn't read the article, but I think in Australia, deemed employment would be determined on a driver by driver basis? Some will be and some won't be.

      • azazal on 20/06/2015 - 17:25

        True contractors by definition are not classed as employees. However in this case provided they could be classed as employees if uber provided the vehicles required for the job and continued to pay them as individuals on an hourly rate.

        The amount of work performed for one employer has no impact on the result. You work one day as an employee throughout the year and you're still classed as their employee. Ie contract of service which the majority of the workforce are engaged under.

        Where the basics of employment are reflected throughout the masses there's no point in determining on a case by case basis.

        Quite simply who supplies the car and who drives the car? Uber present that you supply your own car with 4 doors and comprehensive insurance (not that it would be valid anyway)

        The taxi industry as a whole is trickier to determine as there may or may not be a contract of bailment involved in which case ownership and provision of the vehicle may not be clear.

        • grasstown on 20/06/2015 - 21:14

          I was thinking of the hollis v vabu case from years back. Is it not good law anymore? That worker supplied his own bicycle. And was deemed employee

        • azazal on 21/06/2015 - 07:44

          @grasstown:

          A bicycle would not be considered to be significant income generating equipment - https://www.ato.gov.au/Calculators-and-tools/Employee-or-con…

        • grasstown on 21/06/2015 - 08:17

          @azazal: I'm just telling you that that high court held that a bike courier rider contractor who supplied his own bike was deemed an employee.

  • mskeggs on 18/06/2015 - 22:55

    There is certainly no reason under Australian law as it stands that Uber couldn't be sued should an incident happen while using it's contract driver's services. I anticipate they have suitable insurance for common occurrences (a car crash, for example) and have adequately assessed the risks for areas they might not have insurance for (like a driver performing a criminal act, which I think would be hard to lay at Uber's feet, unless they had acted negligently).

  • donnad on 24/06/2015 - 09:19
    -1

    They do not have suitable insurance because they are privately owned and registered vehicles that are not covered for commercial work, taxi owners pay $7000 a year for their registration to ensure they have commercial CTP cover, they also have to have public liability insurance, these illegal taxis do not!
    Under ATO laws there is different rules for taxi drivers they must have an ABN, they must pay GST on the very first dollar they earn!
    These illegal taxi services are unlawful, unsafe.
    Uber has been issued a "Cease and Desist" order by the QLD Government but believes they are above the law, the sooner they are stopped the better!

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