The Swiss canton of Geneva said Friday it had classified ride-hailing giant Uber as an employer, ordering a halt to its activities unless it pays the social charges for its drivers.
The head of security, employment and health in the cantonal government, Mauro Poggia, told AFP that it had conducted an in-depth judicial analysis of Uber's case, and determined that the drivers should be considered employees and not independent contractors.
Uber drivers are currently paid for each ride and are considered self-employed which means they are not entitled to benefits including paid holidays, pensions and sick leave.
But Poggia said Geneva had "determined that there was a subordination link." This, he said, "means that the driver is not in effect free, neither to choose his clients, nor set the price, nor pick the route, nor to contest a sudden decision to let him go."
Uber, which is facing regulatory issues in a range of countries, is therefore subject to Swiss employment law, meaning it is responsible for paying social charges for its drivers.
Poggia stressed that the order is retroactive, meaning that Uber would be expected to pay social charges for all of its drivers since it entered the Geneva market in late 2014.
He also pointed out that the order is based on Swiss federal law, meaning that other Swiss regions might soon follow Geneva's example.
Uber has 30 days from the time the order was issued last Tuesday to appeal, Poggia said.
If it does appeal, it will be permitted to continue with its activities until a final verdict is reached.