Uber and Lyft are some of the rideshare companies that have grown fast due to digital technology. The Hr department should incorporate the drivers as their employees and not as independent contractors. Absorbing the drivers as employees will create a more cordial relationship with them, and the companies will enjoy the loyalty of the employees. (“Uber Faces Liabilities If Drivers Are Employees | PYMNTS.com”, 2020)
Changes in drivers’ legal employment status will have undesirable effects on the company but will be favorable to the drivers. Regular employment will ensure the responsibility for the welfare of drivers. Companies will pro the drivers’ social security by ensuring they pay mandatory minimum wage, pay for health insurance, pension scheme, paid sick leave, a day off, overtime premium rate, and all benefits as required by the employment laws. All this will be a big challenge to the companies such as Uber and Lyft that have denied drivers their privileges by classifying them as independent contractors. There is a possibility of rideshare companies facing legal challenges and liabilities resulting from mistreating their employees. The clients who experience unfair treatment will also be a threat to the company. It is their sole responsibility to ensure their employees carry out their duties right and to customer satisfaction. (“Uber Faces Liabilities If Drivers Are Employees | PYMNTS.com”, 2020)
If the rideshare organizations change to the drivers’ legal employment status of the drivers and take up all the responsibilities, it wouldn’t be a walk in the park for them, which will create a fairground for competition with other traditional taxi companies. However, the digital feature associated with the rideshare services gives them an upper hand in business, and this may keep them afloat amidst tough competition (Cox, 2020)
Rideshare employers are responsible for protecting the independent contractors by ensuring that they are paid minimum wages with a premium overtime rate, paying for their insurance cover, and providing job security. The companies should not exercise control over the independent contractors (drivers) if they don’t consider them their employees. (Cox, 2020)
References
Uber Faces Liabilities If Drivers Are Employees | PYMNTS.com. (2020). Retrieved 19 November 2020, from https://www.pymnts.com/legal/2019/uber-faces-millions-in-liabilities-if-drivers-become-employees
Cox, M. (2020). Major challenges faced by Lyft in US market – Lexelerator. Retrieved 19 November 2020, from https://www.lexelerator.eu/major-challenges-faced-by-lyft-in-us-market/