Uber's tax problems: advocacy, adversity and society

Uber is having problems with its drivers and the US tax code.

Without going into too much detail, what it comes down to is that Uber wants to consider all its drivers contractors and the drivers (and IRS) want to consider them employees.

The benefit to Uber of 'their' way of looking at their business model is that they don't have direct responsibility for anybody. That keeps their costs low, their liability lower and their shareholders happy.

The benefit to the drivers and IRS to 'their' way of looking at the work that's being done is that Uber has to pay toward their taxes, provide benefits and generally give back more than simply an opportunity to make money for themselves (and even more for Uber and its shareholders).

Uber is part of what's being very prettily called the "sharing economy" - a $30+bn market that's only going to get bigger.

To be fair, this model began long before it was called the "sharing economy." In fact, it started in the late 1980s when companies started laying off their people in large, large numbers...only to hire them or others like them back as contractors.

Back then, it was the early days of "outsourcing." Standardized functions that weren't considered to need a proprietary approach (or company loyalty) all got handed off - from travel to accounting to HR.

The logic was exactly the same: The company's expenses and liabilities lower when they use contractors rather than hire employees.

And throughout that time, the same battle that Uber is fighting has been waged.

You'd think that by now - and with this level of 'sharing' being done between employers and contractors and the IRS - that someone would have realized that there's an easy fix: Modify the tax code.

All that's really needed is a means for companies to maintain their independence and manage their costs while contractor/employees get some of the benefits of being an employee with the full understanding that, as contractors, some things need to remain their responsibility.

In fact, if Uber and its sharing brethren would take some of those billions and point them toward their corporate and tax attorneys and accountants specifically to advocate for change rather than fight exclusively for the status quo, the problem would be solved quickly and easily.

This is a societal problem. We've changed the way we do business. Now it's time for businesses, their advocates and government officials to catch up with each other so that everyone - and I mean everyone - in society wins.