Uber continues struggle with workers’ compensation problem

Uber making it easier for drivers to purchase occupational accident insurance but does not solve the workers’ compensation problem.

We saw an interesting BuzzFeed article reporting on Uber’s pilot program for drivers who want to purchase insurance coverage for on-the-job injuries.

Customers in eight states will see a 5 cent per mile increase while drivers will pay an additional 3.75 cents per mile. Benefits up to $1 million for medical expenses, up to half of a driver’s average weekly earnings, and a maximum of $150,000 in survivor benefits will be offered.

Uber is at the forefront of the gig economy and shows how technology is creating problems for the traditional workers’ compensation model. Disputes about whether Uber drivers are independent contractors or employees have been raging. This distinction has significant legal and tax consequences. Independent contractors get none of the protections that employees currently receive.

Employees hurt on-the-job in Michigan are entitled to unlimited medical treatment and 80% wage loss benefits. Payments continue for the entire length of disability. Employers are responsible for purchasing workers’ compensation insurance and it pays regardless of fault. In exchange, employers get immunity from civil lawsuits. Forcing Uber drivers to purchase subpar occupational accident insurance is not the answer.

Michigan lawmakers passed new auto insurance laws in 2016 to address transportation network companies. Included was a test to determine if a driver was an employee or independent contractor. This creates a potential hodgepodge of legal standards for workers’ compensation. What other gig economy jobs will get their own test and be excluded from workers’ compensation?

Michigan Workers Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled workers exclusively for more than 35 years. Call (844) 201-9497 for a free consultation today.

Related information:

Are new workers’ compensation laws needed for Uber and Lyft drivers?

Photo courtesy of Creative Commons, by Michel Curi.

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