Uber drivers contractors in Florida, not employees


  • December 4, 2015
  • /   Shannon Nickinson
  • /   economy

Since early November, Uber drivers have been able to pick up people at the Pensacola International Airport.

The popular ride-sharing service allows users to connect through a smartphone application with drivers willing to give them a lift.

As state lawmakers in the House worked on legislation that would prohibit local governments from regulating Uber, Lyft and other ride-sharing services, the state’s economic opportunity office ruled those drivers are not considered employees.

Florida Department of Economic Opportunity executive director Jesse Panuccio on Dec. 3 issued a final order that classifies Uber drivers as independent contractors under Florida law.

The ruling means Uber drivers are not entitled to unemployment insurance in Florida. It is in opposition to recent decisions in two other states.

“Uber is a technology platform that, for a fee, connects transportation providers with customers seeking transportation,” Panuccio said in a news release.

Uber legislation in the House

The proposal (HB 509) is opposed by taxi companies as unfair competition and by local governments as an infringement on local control.

It must still find a way to connect with the Senate, where it has no companion bill.

The proposal would set insurance requirements for transportation-service drivers while they are logged on, require prospective drivers to undergo criminal background checks and prohibit local governments from imposing their own rules on the app-based companies as they do now for taxi companies and limousine services.

"We don't want a circumstance where someone is wanting to comply with the law, and wanting to perform a transportation network service, and inadvertently crosses a county or municipal line and could become a criminal because he could have disparate insurance requirements or disparate registration requirements," said Rep. Matt Gaetz, a Fort Walton Beach Republican who is sponsoring the measure.

Among the issues for the cab companies is part of Gaetz' proposal that would require Uber and other app-based companies to pay annual fees of $5,000 to the Department of Highway Safety and Motor Vehicles. Some cab companies pay more than $100,000 annually in fees with cities and counties.

The House and Senate could not reach agreement on a similar bill last year.

Gaetz said he hopes to be able to "meld" his proposal into any Senate measures for the 2016 session, which starts Jan. 12.

Uber drivers, users and advocates say it is a technology company. Taxi companies have complained because of that stance, Uber drivers have an unfair advantage in the marketplace because they are not subject to the same fare structures, and other regulations that cab companies face.

Uber drivers are contractors, not employees

According to Panuccio’s order, Uber drivers:

— Have significant control over the details of their work.

— Use their own vehicles and choose when, if ever, to provide services through Uber’s software.

— Decide where to work, which customers to serve and have control over many details of the customer experience.

— May provide services through, or work for, competing platforms or other companies when not using the Uber application.  

“On these facts, it appears that Uber operates not as an employer, but as a middleman or broker for transportation services,” it says.

The Florida ruling contradicts California and Oregon decisions that found Uber drivers are employees under the law of those states.

“These opinions are not persuasive, as they largely ignore the contract, and misconstrue the actual course of dealings, between the parties,” Panuccio’s decision reads. “These rulings appear to rest on the fact that Uber could not be in business without drivers.  But the same is true of all middlemen.  Uber is no more an employer to drivers than is an art gallery to artists.”

Pensacola’s Uber arrangement

In a Nov. 5 memo, City Administrator Eric Olson wrote that the mayor’s office had negotiated an interim agreement allowing Uber to operate at Pensacola International Airport

It allows Uber drivers to operate at the airport for four months for a one-time fee of $1,000. The fee is paid by Raiser LLC, a wholly owned subsidiary of Uber Technologies Inc.

The agreement was signed on Nov. 11, 2015.

The Uber app is linked to a credit card, so no money is exchanged at the time of the ride. If you want a ride, you open the app. A GPS map shows you how many Uber cars are near your location. Choose a driver, see the fare and wait for your ride.

{{business_name}}Pensacola Mayor Ashton Hayward III and Uber advisor David Plouffe at Uber headquarters during the 2015 U.S. Conference of Mayors in San Francisco.

Pensacola Mayor Ashton Hayward III and Uber advisor David Plouffe at Uber headquarters during the 2015 U.S. Conference of Mayors in San Francisco.

The convenience and cost savings over traditional taxi fares make Uber attractive to users. Uber drivers say they like the freedom the job gives them to set their hours.

But as it has in other cities across the country, Uber’s entry into the Pensacola market has stirred the ire of taxi drivers who decry the lack of regulation on the service.

At an August public hearing on the matter, Uber drivers and supporters said the service harnesses the entrepreneurial spirit of the modern, technology based economy.

Taxi drivers who spoke maintained that Uber cars are taxis by default — that they operate like for-hire vehicles just like taxis, which means they should be regulated under city code, just like taxis.

Vernon Stewart, the city's public information officer, said there has been no further progress in the city putting together a permanent agreement on Uber operations in Pensacola.

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