Trial date set for the lawsuit that could change Uber forever
In California, Judge Edward M. Chen ruled that the trial relating to the class action lawsuit against Uber over its classification of drivers as independent contractors will start June 20th, 2016 and will last five weeks. The case, O'Connor v. Uber, gained momentum in September when Judge Chen certified the case as a class action, allowing other drivers to join the suit. The case will come down to whether Uber can successfully convince a jury that its classification of drivers as independent contractors, rather than employees, is appropriate. Earlier this week, David Plouffe, Uber's top political strategist, argued that there is no typical Uber driver, but rather a range of types, from professional car service drivers to those that only drive a few days a week. However, the plaintiffs argue that because Uber controls aspects such as fares and performance standards, they should be considered employees and receive entitlements stipulated under California's labour laws, like reimbursements for vehicle's expenses. In a recent decision, a California labour commissioner ruled that an Uber driver was indeed an employee and ordered Uber to reimburse the driver for her expenses. However, the class action lawsuit is expected to have more far-reaching effects.

The fate of Uber’s business model — the same business model that has earned the company a $50-billion valuation — will be decided next summer, after a federal judge in San Francisco set a June 20, 2016, trial date for a class action lawsuit against the on-demand transportation company.

Judge Edward Chen, who recently certified the class, has set aside five weeks for the trial, which will take place before a jury.

The case, O’Connor vs. Uber, concerns the ride-hailing company’s classification of drivers as independent contractors rather than employees. Plaintiffs in the case allege Uber treats its drivers as employees while denying them any of the benefits.

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Much is at stake for the San Francisco company, which, in addition to delivering people, is now also in the business of package and meal deliveries. If the jury rules in favor of the plaintiffs, thousands of Uber drivers may be entitled to back wages, expense payments and benefits, which could significantly increase Uber’s cost of doing business and hurt its valuation.

Companies in Silicon Valley — particularly those that use independent contractors as part of their core business — are paying close attention to how the case plays out, as any ruling could have a ripple effect in the on-demand economy.

After the case goes to trial next summer, any decision can still be appealed, and it could take months or even years to arrive at a final decision, according to employment lawyers.

Twitter: @traceylien