Daniel Wiessner of Reuters reports that a staffing firm filed a lawsuit alleging its competitors misclassified workers to gain a competitive advantage. Daniel writes
Jan 9 (Reuters) – A hospitality staffing firm has filed a novel lawsuit accusing several competitors of misclassifying their workers as independent contractors, who are cheaper than employees, in order to gain a competitive advantage.In a complaint, opens new tab filed in California state court on Wednesday, The Party Staff claims that app-based “gig” services Qwick, Instawork, Tend, and Nowsta can offer lower prices because they do not have to pay the minimum wage, overtime and payroll taxes or maintain workers’ compensation insurance.And major food service firms Aramark (ARMK.N), opens new tab and Guckenheimer Enterprises, who are also defendants in the lawsuit, profit from and perpetuate the staffing firms’ practices by contracting with them to provide workers for catered events, The Party Staff claims.“Plaintiff, which has complied with the law by classifying its workers as employees, has had its business significantly undercut by Defendants’ actions and has lost numerous clients as a result, significantly impacting its revenue,” the Hollywood-based company said in the complaint.
Read the full story Staffing firm sues rivals for treating workers as independent contractors | Reuters
This is similar to a lawsuit by a limousine company against Uber which alleged that Uber illegally misclassified drivers to gain a competitve advantage. See Lawsuit Accuses Uber Of Saving $500 Million Annually By Misclassifying Drivers – SFGate
