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Uber's version of workers’ comp: Innovative or insufficient?

To say Uber has experienced “growing pains” in their relatively short existence would be the definition of an understatement. Controversial disputes with Google, hostile workplace scandals, and high-level resignations (most recently, their CEO) have tarnished the image of the rideshare company.

While the federal government does not provide data on Uber drivers, their statistics reveal that counterpart taxi operators are as likely to suffer injuries on the job as workers in dangerous logging and mining industries are. More alarming, those drivers share the likelihood of being killed on the job with police officers.

Yet, unlike taxi drivers, Uber operators were not entitled to workers compensation benefits. Far too often, they had to rely on their own health insurance to pay medical bills.

Recently, Uber seemed to come around on the issue. In June, the ride-sharing service partnered with OneBeacon and Aon insurance companies to pilot a voluntary, low-cost option that would provide injured drivers in eight states the chance to recoup their wages and cover medical expenses. The plan sets aside $3.75 per-mile of their compensation. Uber is offsetting those costs by raising rates.

However, what Uber considers coverage for drivers may slightly resemble workers’ compensation, but it falls short in many areas, as evidenced by the all-caps headline on the policy’s first page.

“THIS INSURANCE IS NOT WORKERS’ COMPENSATION INSURANCE.”

Differences exist and include:

  • The plan is optional and drivers must pay for it. By law in most states, workers’ compensation insurance for traditional employees is both mandatory and paid for directly by the employer.
  • Workers’ compensation commonly pays out two-thirds of salary for injured employees until they are able to return to their job. Uber’s policy maxes out at half of a driver’s average weekly earnings.
  • The policy allows the insurer to deny coverage at their doctors’ discretion.
  • While traditional workers comp has an appointed State Board that handles disputes, Uber requires a binding arbitration proceeding. Their drivers’ effectively forfeit their rights to appear before a board and file an individual or class action lawsuit.
  • The policy’s language contains a preemptive denial of permanent disability coverage for mental health and trauma.
  • No survivor’s benefits in the event of an accident.

Some see a step in the right direction. Other’s see it as yet another example of Uber wanting to continue playing by their own rules,

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