Uber Faces Fine After Dutch Court Rules Drivers are Employees, not Contractors

Ride-hailing company Uber (NYSE: UBER) has lost a court battle in the Netherlands, which ruled that the app’s drivers are employees and not contractors, and slapped the tech giant with a €50,000 fine.

According to a statement from the Federation of Dutch Unions (FNV) seen by Reuters, a Dutch court on Monday determined that Uber’s drivers across the Netherlands are actually classified under the country’s collective labour agreement, and therefore are entitled to receive the same employment benefits as taxi drivers. This means that Uber must now permanently employ its drivers rather than designate them as contractors, and grant them a higher salary and additional benefits should they require sick leave.

The court also handed Uber a €50,000 fine for not abiding by the country’s taxi collective agreement, with the FNV calingd the court’s ruling a major achievement for Uber. However, in response to the latest court ruling, Maurits Schönfeld, Uber’s General Manager for Northern Europe, announced that the ride-hailing giant will appeal the court’s decision, “in the interest of drivers.”

This is not the first time that Uber has been embroiled in a similar dispute. Earlier this year, UK’s Supreme Court dropped Uber’s appeal that drivers are self-employed rather than employees, which granted them paid leave and minimum wage.

Information for this briefing was found via Reuters. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.