Law Knowledge Legal Advisors: Uber Driver Legal Exposure Analysis

This legal memo, prepared by Law Knowledge Legal Advisors for Sunshine Hundred Investment Firm, analyzes Uber's legal exposure concerning the conduct of its drivers within the context of the gig economy. It examines the application of agency law principles, including actual express authority, implied authority, and vicarious liability, to the relationship between Uber and its drivers. The memo addresses the concept of 'scope of employment' and its implications for Uber's liability, particularly in situations involving driver misconduct, such as the case of a drunk driver causing a fatal accident. The analysis uses agency law to determine Uber's responsibility in such scenarios. Furthermore, the memo outlines several crucial steps Uber can take to mitigate its legal exposure, including clearly defining driver responsibilities in employment agreements, providing adequate training, and addressing potential misconduct. The memo concludes that Uber faces significant legal risks due to its drivers' actions and stresses the importance of proactive measures to prevent litigation.

LEGAL AND ETHICAL ISSUES

MEMO
To: Sunshine Hundred Investment Firm
From: Law Knowledge Legal Advisors
Date: 21 August 2019
Re: Analysis of Uber business and the associated legal exposures
Dear Sir,
As per our discussion conducted in which you had asked to evaluate the legal
exposure of one of the most renowned organization Uber in context of the conduct of the
drivers of the entity. The following evaluation sheds light on various aspects associated such
as the scope of employment, agency law, and the steps that can be adopted to minimize the
legal exposure due to the conduct of the drivers.
It is vital to note that the organization Uber has been a popular name in terms of the
advent of the gig economy. Such an economy is characterized by a free market system the
independent workers are contacted and hired for the short-term assignments. The drivers
hired and the organization share an agency relationship. The said relationship is characterized
by Actual Express Authority, and the Actual Implied Authority Principle (Mann & Roberts,
2016). On the application of the Actual Express Authority Principle, it can be stated that the
drivers are instructed in terms of the pickup and drop locations, and they are bound to follow
the organization principles. In terms of the principle of implied authority the drivers can infer
to the contracts entered into and adopt such actions as may be deemed necessary to carry out
the express functions. It is significant to note in the context of Uber and drivers relationship
that Uber will not be liable towards the third party, is the third party has the knowledge that
particular acts are beyond the authority of the drivers (Mann & Roberts, 2016). Further the
principle of ratification may be applied by the Uber to ratify the acts of the drivers even if the
said acts are beyond the authority of the drivers. Thus, when the actions are under scope of
the express authority, Uber will be held liable.
It is essential to note that Uber can be held liable for the conduct of the drivers as per
the legal rule of the vicarious liability. As per the said rule, the employee can be held
responsible for the acts of the employees if the same are falling within the express authority
of the employees. In addition, there also arises liability on the part of the Uber if the drivers

engage in acts of the misrepresentation or the fraud in terms of the actions that fall within the
scope of apparent authority (Miller & Jentz, 2009).
The following section is descriptive of the steps that can be taken by Uber to limit the
exposure of the legal actions because of the conduct of the drivers. The first and the basic
step that can be adopted by the organization is the clear statement of the duties and
responsibilities of the drivers in the employment agreement. This should be in addition to the
clear definition of the rights and responsibilities. It is imperative to state in clear terms that
the driver serving under the brand name Uber are the employees of the independent
contractors. It is further suggested to Uber that the contract between Uber and drivers must be
devised with utmost care to include the unethical practices that may be adopted by the
drivers. This is because the jury is considerate of the contract between the parties when the
same reaches the court, in order to decide the liabilities of the concerned parties (Welby,
2018). Therefore, the possible liabilities that can be imposed by the courts must be evaluated
and accordingly the terms of the contracts must be defined.
Some of the yet another measures that can be adopted is provision of sufficient
training to the drivers. These must be in addition to the awareness about the compliance of
the respective state level legislations (Fields & Cheeseman, 2016). It is further imperative to
note that there are incidences of the misconduct where the drivers are forced to act
aggressively because of the equivalent behavior from the passengers. In such cases, there is
equivalent aggression and adverse behavior from the driver’s side as well such that they lose
the control of the vehicle and indulge into accidents. The drivers must be provided training
and safety measures to address such situation such as the immediate notice to the entity via
the application of such passengers and Behaviour.
Hence, the discussions conducted in the previous parts aid to conclude that the
conduct of the drivers poses serious risks in forms of litigations to the organization Uber. The
customers can opt for the shelter of the agency relationship and claim the damages of the
negligence caused by the drivers. Hence, in order to prevent the payment of the damages
because of the drivers conduct, proper policies must be devised.

References
Fields, C. K., & Cheeseman, H. R. (2016). Contemporary Employment Law. Wolters Kluwer
Law & Business.
Mann, R., A., & Roberts, B., S. (2016). Business Law and the Regulation of Business. USA:
Cengage Learning.
Miller, R., L., & Jentz, G., A. (2009). Cengage Advantage Books: Fundamentals of Business
Law: Excerpted Cases. USA: Cengage Learning.
Welby, J. (2018). Reimagining Britain: Foundations for Hope. UK: Bloomsbury Publishing