You are involved in a ride-sharing application start-up similar to Uber and Lyft called Ryde. At Ryde, drivers use their own personal cars, but the drivers must consent to Ryde having the Ryde logo painted professionally on their cars. Outside of that, there are not many Ryde policies that govern the use, year, make or model of the car except a yearly inspection by a mechanic. Ryde drivers are paid on a per ride basis. While Ryde drivers have no set schedule, they must log at least 10 hours per week or they will be terminated from the application. The Ryde application gives drivers specific routes that they must follow. If the driver fails to adhere to the route three different times, then they are denied access to the application for a period of one week. Ryde has chosen to classify its drivers as independent contractors. Lately, you have seen many news clips and articles about the controversies surrounding Uber, Lyft and even FedEx regarding the classification of their drivers as independent contractors. You even noticed that there have been a couple of court cases on the issue, and the outcomes were not in favor of the companies. You are concerned that Ryde or others may raise similar legal concerns over its classification of the drivers as independent contractors. You decide to conduct some more research into the issue to determine if Ryde should consider treating drivers as employees to avoid potential litigation.
1. Why might companies like Uber, Lyft, FedEx and Ryde want to classify their drivers as independent contractor agents instead of employee agents? Cite to at least 1 source to support your answer. The source can be from news articles, scholarly articles or even court cases related to this issue.
2. How did the courts in the Uber and FedEx cases rule and why? Cite to at least 2 resources to support your response. They can be from news articles, scholarly articles or even the orders issued in the cases.
3. Based on what you have learned so far about Agency Law, the ramifications of miss-classification of drivers and recent court rulings, how do you think Ryde should classify its drivers and why?
4. What process did you use in finding sources for questions one and two? Be specific. Which search engine or databases did you use? What was your “research trail?”
5. Why did you choose to use the sources that you chose for questions one and two?