Dive Brief:
- A federal judge issued a temporary injunction on Seattle’s policy allowing Uber, Lyft and taxi drivers to unionize, KUOW-FM reports. The policy is the only one of its kind in the nation.
- The U.S. Chamber of Commerce and a few driver groups backed U.S. District Judge Robert Lasnik’s injunction. However, Dawn Gearhart, a local Teamster’s representative, said the decision is a setback and negotiation between the parties was preferable to a court duel.
- Mike O'Brien, a Seattle city councilmember, said he views the injunction as the judge’s way of slowing down the unionization process to allow the parties to work out an agreement.
Dive Insight:
This is a significant court battle for employers nationwide — not just those in Seattle. The outcome would set a crucial employment law precedent for the gig economy, a fast-growing but chaotic (in a regulatory sense) industry that more and more workers seem eager to join.
Uber is keen on preventing its drivers from unionizing, and has tried to push an argument against this movement through text messages, meetings and even podcasts targeting drivers. Currently, those drivers are classified as independent contractors, and a ruling in favor of any other classification would have implications for an entire class of employees, across multiple industries.
Some driver groups argue that they are in fact full-time employees of Uber, and should receive compensation and benefits to reflect that status, including being paid the minimum wage. That argument hasn't been successful in the U.S., but it did pick up notable steam in the U.K., where a tribunal ordered Uber to do just that.
Uber can count the injunction as a temporary victory among a string of losses, including drivers’ misclassification lawsuits, sexual misconduct allegations and the bad publicity that has followed. The ride-hailing company is proactively working on positively changing its culture. If successful, drivers might not feel the need to unionize. The same might apply to Lyft and traditional taxi companies.
