Ride sharing companies are largely hailed as the advent of the gig economy, which is the idea that people do not work as permanent employees for one employer but instead work in a labor market characterized by short-term contracts or freelance work. While creating a new type of entrepreneurship for individuals, a gig economy raises a host of new legal questions about the law of agency for companies utilizing gig workers.

Widgets operates a ride-sharing business in a small town.Your boss at an investment firm has asked you to evaluate Widget'slegal exposure for the conduct of its drivers, given the information below and identify, and to explain the law and legal liability in this vast new gig economy world.

What is the law as to deeming one an employee versus an independent contractor?