Uber driver is employee, not freelancer, Swiss agency rules

(Reuters) — An Uber Technologies Inc. driver is an employee for which the company must pay social security contributions, a Swiss insurance agency has ruled, dealing a blow to the U.S. ride-hailing platform that says drivers are independent contractors.

The California-based startup whose cab service has expanded worldwide vowed to challenge the ruling, the latest clash with regulators that have accused it of bypassing national labor protection standards and shunning collective negotiation with drivers who work on freelance terms.

In October, a British tribunal ruled Uber should treat its drivers as employees and pay them the minimum wage and holiday pay.

Suva — which as a provider of obligatory on-the-job accident insurance in Switzerland helps decide which workers are freelance — found an Uber Technology driver was staff because he faced consequences if he broke Uber rules and could not set prices and payment terms independently, broadcaster SRF reported.

A Suva spokesman confirmed the report but said it concerned a particular driver who had sought to clarify his status, not a general ruling on Uber's business model. "For us, it is not about the company, but about the person involved," he said.

Nevertheless, Rasoul Jalali, general manager at Uber, took issue with Suva, which he said had classified independent drivers as employees in other cases before Uber arrived in Switzerland, triggering other challenges.

"Taxi dispatchers have had exactly this issue for years and yet today there is not one driver employed by a big dispatcher in cities such as Zurich or Geneva. So this is nothing new in Switzerland and we will challenge it, just as others have," he said in a statement.

"Drivers using the Uber app are independent contractors who enjoy all the flexibility and freedom that come with being self-employed."

Founded in 2009, Uber has taken the world by storm but come up against opposition too.

Various services it has proposed have been banned in some countries and it faces numerous battles in U.S. courts over labor standards, safety rules and pricing policies that trigger fare surges at peak times.