From JDSupra Business Advisor, Jessica Catlow of Mintz Levin writes about recent cases involving Uber and Lyft in which workers claimed that they should be treated as employees instead of independent contractors. Jessica reports that these disruptive “technology” companies have business models based on classifying drivers as independent contractors. She describes the judges’ responses:
The judge in the Uber case stated “[i]t’s never easy. There’s not just one factor you can point to and say ‘Boom, that’s it.’” The judge in the Lyft case noted that the test for classification has not kept pace with technology and the changing workforce, noting “California law defines whether workers are employees or independent contractors, and there’s a test, but the test and classification system are woefully outdated . . . . It seems to me, as a matter of common sense, that Lyft drivers don’t fall into the traditional understanding” of [the two classifications.] They seem to fall into a third category.”
The plaintiffs in both cases noted that they could be terminated if they did not accept a certain number of passengers. Both Uber and Lyft countered that, even so, they did not control the drivers and rather provided only a platform, or referral service, to connect drivers and passengers, even though the drivers are an integral part of its business. Indeed, as the judge noted in Uber, without the drivers the company could not operate or exist. Based on comments by the judges, it appears that both cases will likely go to a jury….”
Read the full story at Uber and Lyft Drivers: Employees, Independent Contractors, or Something Else Entirely?