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13 December 2017
On November 9 2017 the Federal Supreme Court held that independent taxi drivers affiliated with a central headquarters are to be considered employees. Until this decision, taxi drivers connected to their headquarters by follow-up contracts only were considered self-employed. The decision means that drivers will be much better protected in future, although prices will rise for consumers as a result.
Taxi drivers were classified as employees under social security law for the first time in 2014 by the Swiss Accident Insurance Institute (Suva), meaning that the taxi headquarters had to pay social contributions accordingly.
In the case at hand, three drivers and a taxi headquarters lodged a complaint with the Zurich Cantonal Court, which was subsequently refused. The court concluded that there were numerous contractual obligations between the headquarters and the drivers which suggested a subordinated relationship as drivers were required to:
The drivers' three-month notice period indicated a dependent position. In addition, the headquarters offered online deals for private individuals and companies and employed staff who were responsible for fulfilling these offers.
According to the Federal Supreme Court, the drivers made no significant investments other than buying their cars and had no staff. The plaintiffs argued that they had invested between Sfr35,000 and Sfr50,000 when purchasing their vehicles, which should be considered an entrepreneurial risk. However, the Federal Supreme Court upheld the lower-court decision, stating that the purchase and maintenance of a taxi does not constitute sufficient entrepreneurial risk, as the cost of purchasing a taxi corresponds to the cost of a private vehicle. Further investments for premises, personnel or advertising did not apply. Thus, other than a monthly administrative contribution of Sfr775 to the headquarters, the drivers incurred no other major fixed costs.
According to Christoph Wieland, president of the Taxi Division of the Swiss Commercial Vehicle Association, up to 2,000 taxi drivers in Switzerland work through central headquarters. The consequences of the Federal Supreme Court precedent are far-reaching for taxi headquarters, their clients and drivers. Taxi headquarters will charge more and potentially earn less, while drivers' social protection will improve significantly, at least in the short term.
It is likely that the court will soon decide similarly in a pending Uber case.
For further information on this topic please contact Thomas Rihm at Rihm Rechtsanwälte by telephone (+41 44 377 77 20) or email (email@example.com). The Rihm Rechtsanwälte website can be accessed at www.rihm-law.ch.
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