Sharing Economy Misclassification: Employees and Independent Contractors in Transportation Network Companies

This note focuses on the worker classification issue as presented by transportation network company (TNC) drivers. Part I defines TNCs and their surrounding regulatory framework and describes the business model of Uber Technologies, Inc. (Uber), the most prominent TNC. Part II examines the difference between employees and independent contractors by tracing the development of the distinction and by describing the current legal test for worker classification. Part III demonstrates how courts apply the worker classification test in practice. Part IV draws the conclusion that a jury is likely to find, based on the current legal classification test, that the class of Uber drivers certified for trial are Uber's employees. However, this Note argues that such a blanket classification is inappropriate and will have a significant impact on other sharing economy companies -- both in litigation and day-to-day business. Part IV closes by advocating that a new method of employment classification is needed to account for the complex working relationships in the sharing economy and by exploring possible alternatives.