Question

Uber, Lyft, Amazon and other companies have been sued by workers who have been classified as independent contractors. The attorney for the plaintiff in one lawsuit stated, "...Uber holds themselves [sic] out as having this technological platform that just allows drivers and passengers to interact, but the reality is [that] Uber is involved in every aspect of the operation..." The attorney further stated that Uber controls, "how they [workers] do their jobs and for what price, for instance, "are evidence that they are being misclassified by the companies..." as independent contractors. In other words, the attorney contends that Uber has a high level of control over how the work is performed. By classifying drivers as independent contractorsa. Companies do not have to pay any benefits or unemployment compensation to workers.b. Companies have more expenses than if they classify drivers as employees.c. Companies must still pay unemployment benefits when workers leave.d. All of the answer choices are correct.

Answer 1

Answer: a. Companies do not have to pay any benefits or unemployment compensation to workers

Explanation:

Independent contractors are in charge of paying their own taxes and benefits, unlike employees whose employers must provide benefits like compensation, unemployment, and health insurance. By misclassifying their workers as independent contractors, companies such as Uber, Lyft, and Amazon are avoiding legal responsibility for those benefits to save money, but that´s against the law and they could be penalized.