Ontario court rules that Uber can't use arbitration to keep its drivers from suing it

The Ontario Court of Appeal has ruled that Uber can't use binding arbitration "agreements" to stop its drivers from joining a class action suit against the company; the court held that the arbitration clause was "illegally outsourcing an employment standard."

Under Uber's non-negotiable driver "agreement," drivers who wanted to sue the company had to pay up to US$14,500 to a Dutch arbitration company to seek any kind of redress.

Uber plans on appealing.

In California, Uber succeeded in killing a driver class-action by invoking its arbitration clause, but then when the drivers engaged in mass-arbitration, the company refused to actually arbitrate.

Arbitration is a private system of law that corporations have expanded in the neoliberal era to strip customers and employees of their legal rights.

``I believe that it can be safely concluded that Uber chose this arbitration clause in order to favour itself and thus take advantage of its drivers, who are clearly vulnerable to the market strength of Uber,'' the appeal court said. ``It is a reasonable inference that Uber did so knowingly and intentionally.''

The lawsuit, which claims Uber drivers are employees rather than contractors and thus subject to Ontario's labour legislation, had been stayed earlier this year by a motion judge who found Uber drivers were bound by the arbitration clause.

The three-judge appeal panel says the motion judge erred on several points, including in considering the arbitration clause like the kind seen in ``normal commercial contracts'' where the parties are relatively equal in power and sophistication.

Proposed class action against Uber can proceed, appeal court rules [The Canadian Press/Human Resource Magazine]

(Thanks, Bryan!)