The recently rejected proposed California Uber class action lawsuit settlement for up to $100 million has not quieted the debate over whether Uber drivers should be employees or independent contractors.

Currently, dozens of lawsuits against Uber are pending in state and federal courts, with drivers seeking to gain employee classification status.

Specifically, the company is fighting more than 70 federal lawsuits in courts across the country and has resolved at least another 60, according to a search of a national database of federal court cases. And that doesn’t include actions in state courts.

California Uber Class Action Lawsuit Issues

Still, for California Uber drivers the ongoing Uber lawsuits highlight an important issue that is becoming more and more common in on-demand society.

Many tech-driven companies prefer to use the independent contractor model, because doing so can save them immense costs in not having to provide benefits such as insurance and not being subject to overtime and other wage laws.

This is exactly what drivers in the California Uber class action lawsuit have an issue with. A number of Uber drivers opposed the settlement terms of the California Uber class action lawsuit, which was ultimately rejected by the court.

By attempting to settle the California Uber class action lawsuit with drivers, Uber essentially dodges the real issue at root: its independent contractor model, some drivers say.

The practices of Uber raise many difficult issues under the labor and employment laws. The most important is the question of whether Uber drivers are employees or independent contractors.

At stake is whether Uber has to provide the benefits of state and federal labor laws to its drivers. These include rights to minimum wage, overtime pay, and in many states, paid rest breaks, expense reimbursement, tips, workers compensation, and health and safety protections.

The issue of employee status also implicates the ability of Uber drivers to form a labor union or whether their attempts to unionize make the workers liable for antitrust violations.

Independent Contractor or Employee?

Under California Labor Laws, independent contractors are not subject to a variety of employment laws that are meant to help protect the rights of employees, such as wage and hour laws, workers’ compensation and unemployment benefits and anti-discrimination laws.

By misclassifying workers as independent contractors instead of as employees, many employers can avoid the high costs of paying benefits and taxes on employees.

In California, they can also avoid reimbursing workers for work-related expenses, such as gas for California Uber drivers.

Misclassifying workers as independent contractors can carry steep fines and penalties under federal and California labor laws.

In 2015, the California Labor Commissioner ruled that one Uber driver was indeed an employee, not an independent contractor, and ordered Uber to reimburse the driver for her expenses.

In addition to the decision by the California Labor Commissioner, the California Unemployment Insurance Appeals Board has ruled that an Uber driver is an employees eligible to obtain unemployment benefits. Furthermore, the National Labor Relations Board is currently considering whether Uber drivers satisfy the test for employee status under the labor law.

Judge Chen, who is presiding over the California Uber class action lawsuit has ordered parties to come to an agreement on how to proceed with Uber’s request to stay litigation.  A status conference has been scheduled for Sept. 15.

If you believe you have been misclassified as an independent contractor and denied your rights as an employee, a California Uber Driver litigation attorney may be able to advise you on your rights under California and federal law.