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Uber drivers could earn thousands in benefits as full-time employees

Ever since the California Labor Commission ruled in June that former Uber driver Barbara Berwick should be considered an employee—not an independent contractor—there’s been speculation of what will happen if the $51 billion unicorn loses its ongoing appeal of the non-binding decision. (The well-funded ride-sharing platform likely has enough resources to adapt its relationship with drivers to meet the demands of an unfavorable ruling.)

A new analysis published Tuesday flips that focus. It seeks to determine what drivers would receive if the company were to provide them with the same benefits as its full-time employees. Personal finance site Nerd Wallet estimates that Uber drivers in six major cities in the United States—if deemed full-time employees—would receive paid holidays and health care benefits worth an average of $5,500 annually, plus thousands more dollars in mileage reimbursement.

Nerd Wallet analyst Jeffrey Chu arrived at his $5,500-plus conclusion by first examining how much Uber drivers would receive if they had access to the nine paid holidays that are given to Uber’s current full-time employees. Using hourly wage data from Uber for each of the six cities included in the analysis—Boston, Chicago, Los Angeles, New York, San Francisco, and Washington, D.C.,—and assuming an eight-hour work day, Nerd Wallet calculated that drivers would receive between $1,167.12 and $2,134.80 in holiday pay.

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By considering Bureau of Labor Statistics data on per capita health expenditures in the six cities, Nerd Wallet estimated that depending on where an Uber driver lived, he or she would receive health care benefits valued at between $2,869 and $4,518 as full-time employees.

If drivers win full-time status, mileage reimbursement could be the source of their biggest gains. In less than two months of driving, Berwick, the Uber driver in the California case, racked up 6,468 miles and was owed $0.58 per mile for a total of $3,878, plus $274 in interest, according to the Commission’s ruling. Extrapolated for an entire year, that mileage and reimbursement rate would award her $22,315 to cover gas, oil, insurance, repairs, tires, vehicle maintenance, and depreciation. Uber must pay Berwick for mileage because California law requires employers to provide employees with mileage reimbursement. Nerd Wallet assumes that because Uber is based in California it would also be required to reimburse drivers in other states at similar rates.

While the California case relates to just a single driver, if it’s upheld, it could motivate Uber drivers nationwide—and other sharing economy workers, for that matter—to seek employee status. And if they worked enough hours they could be considered full-time.

The number of hours logged by current Uber drivers would suggest that very few would earn that full-time status, though. According to a driver survey published earlier this year, 50% of Uber drivers in the United States, on average, drive fewer than 10 hours per week. It’s also possible that drivers’ use of the app could change should courts alter their classification—meaning that making projections about what full-time employee status would mean for drivers as they operate now may be a stretch. An Uber spokesperson said that if drivers became employees they would “drive set shifts, earn a fixed hourly, wage, and lose the ability to drive using other ride sharing apps as well as the personal flexibility they most value.”

The post has been updated to reflect comments from Uber.