Yesterday’s Wall Street Journal has an in-depth look at Uber’s forays into the delivery business, including a description of the company’s food delivery service, UberEats. The Journal article focuses on the hurdles Uber faces in the delivery sector, but, for labor and employment lawyers, there’s a particularly interesting tidbit that comes in the middle of the piece. According to the Journal:
One of Uber’s main goals with UberEats is to give drivers a way to earn income and stay on the road from 10 a.m. to 2 p.m., a slow period when drivers are prone to drop off the service, according to a person who has discussed the program . . . .
Customers pay a delivery fee of $3, and participating drivers get $12 an hour plus $2 per order and temporary bonuses of as much as $20 a day to start making UberEats deliveries, drivers in Chicago say. Those rates may vary in other cities. Uber won’t comment.
In general, Uber drivers are paid per ride. But it appears that drivers who also do UberEats deliveries are being paid by the hour. Under certain tests of employment, this form of payment can be relevant – though not dispositive – in determining whether the drivers are employees or independent contractors. Under California’s test of employment status – the test that the federal courts are applying in both the O’Connor v. Uber and Cotter v. Lyft litigation – one of the “secondary indicia” of employment is “the method of payment, whether by time or by the job.” Applying this test, California courts have held that hourly payment, as opposed to payment per piece or per job, is indicative of employment.