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Are Uber drivers employees or contractors?

Over the past year, the value of Uber has gone through the roof. While this may be good news for company founders, the drivers that "make or break" the service continue to face a variety of questions.

Many drivers continue to claim that they are Uber employees, not contractors. Thanks to a recent ruling by California's Labor Commission, these drivers are closer than ever before to reaching employee status. The commission recently ruled that Uber drivers should be considered employees of the company, not independent contractors.

Of course, there is a battle to follow, as Uber has already appealed the decision. The company continues to maintain that it does not have any control over the driver; however, the Labor Commission does not agree, noting that the company is "involved in every aspect of the operation."

The recent ruling states the following:

"Defendants hold themselves out as nothing more than a neutral technological platform, designed simply to enable drivers and passengers to transact the business of transportation. The reality, however, is that defendants are involved in every aspect of the operation."

With a valuation of more than $40 billion, Uber continues to lead a fast growing industry. However, this latest ruling could put a damper on its growth, not to mention the impact it could have on its legal and tax structure in the future.

There are times when an individual believes he or she is an employee, just to find the company classifying him or her as a contractor. If this happens, the person must learn more about his or her legal rights as a worker.

Source: Forbes, "Uber Driver Is An Employee, Rules California. There Goes That $50B Valuation," Robert W. Wood, June 17, 2015

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