Geneva to ban Uber if it doesn’t change its operating model

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After a legal analyis the government of the canton of Geneva has decided that drivers of the ride hailing service are employees rather than independent contractors, effectively banning Uber from operating under its current model.

In an interview with RTS, Mauro Poggia, a lawyer and Geneva state councillor, said that Uber is a transport company and as such must employ its drivers.

Employees are treated differently to contractors. One of the key differences is that employers must enroll employees in public and private pensions and unemployment insurance. Contractors, on the other hand, get paid according to their contract and must take care of their own pensions and unemployment insurance.

Uber disagrees with the government’s analysis. It argues that it is a ride hailing platform offering its services to drivers who own and maintain their own vehicles and pay to use its platform. The company plans to mount a legal challenge against the recent decision in Geneva’s court of justice.

According to RTS there are around 800 Uber drivers operating in the canton. One driver interviewed said he fears he will lose his income if Uber decides to leave.

A lawyer representing Uber drivers responded by describing the situation as absurd. According to him the move risks reinforcing the Geneva taxi monopoly and depriving the public of a complementary transport offer. We will continue to have taxis of mediocre quality that are the most expensive in the world, he said.

A spokesperson for Unia, a union, argued that Uber drivers have a right to the social protection provided by employment.

Poggia, who plans to meet with Uber, told RTS that there is no desire for Uber to leave Geneva or to see its drivers lose their jobs. He hopes Uber will stay and employ its drivers.

The issue of whether drivers of ride hailing services should be treated as contractors or employees is being debated across the world. In April 2019, the US federal labor board’s general counsel decided that they are contractors.

Until the court in Geneva reaches a decision Uber will continue to operate normally in the canton.

About Investec

Investec is a distinctive Specialist Bank and Asset Manager. We provide a diverse range of financial products and services to a niche client base in three principal markets, the United Kingdom, South Africa and Australia, as well as certain other geographies. Investec’s strategic goals are motivated by the desire to develop an efficient and integrated business on an international scale through the active pursuit of clearly established core competencies in the group’s principal business areas.

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