Uber has to settle. And the next lawsuit is on the way…

Posted by Bianca Wilk
Bianca

Uber settles a $10 million lawsuit over background checks.

In California, Uber was sued for claiming its background checks were "industry-leading". But they failed to take drivers' fingerprints and a background check without fingerprints is "completely worthless" claimed San Francisco District Attorney. As a result, Uber no longer advertises for having the best background check policy and says that it takes extra precautions.

More suits coming.

But Uber is not out of the woods yet. Another class action lawsuit is set for June this year. The topic is the classification of Uber drivers as contractors instead of employees. Even though Lyft has reached a settlement in January 2016 and won´t have to reclassify its drives as employees, it may be much more challenging for Uber. After all, Uber is the market leader by a considerable margin.

Why are Ubers battles with the law worth following?

Well, it could be the turning point in the sharing economy. It might significantly change how employees in the gig economy are defined. If that happens, all the sharing economy companies are affected. “The result we achieved today goes well beyond its impact on Uber,” said San Francisco District Attorney George Gascón. “It sends a clear message to all businesses, and to startups in particular, that in the quest to quickly obtain market share, laws designed to protect consumers cannot be ignored. If a business acts like it is above the law, it will pay a heavy price.”

Whether taking  fingerprints is even meaningful has been doubted by many. Does this mean that all past convicts can’t drive an Uber? This is seriously doubtful. If Uber is one of the few sharing economy companies performing more complex background checks, what are the other sharing economy companies doing to keep its users safe? Vijilent is working on doing trust & safety checks right, which might be the only way to grow the sharing economy effectively and safely.

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