From Urban Milwaukee, Erik Gunn of the Wisconsin Examiner reports that the Wisconsin Supreme Court will determine whether Amazon delivery workers are employees or independent contractors for the purposes of unemployment compensation. Erik writes:
The Wisconsin Supreme Court will hear arguments next week about whether a group of drivers who deliver packages for Amazon should be considered employees, qualifying them for unemployment compensation if they lose their jobs.
Amazon considers the “delivery partners” to be independent contractors — self-employed business owners outside the unemployment insurance (UI) system. But the Department of Workforce Development (DWD), which administers Wisconsin’s UI program, contends they’ve been misclassified and that Amazon owes more than $200,000 to the state’s UI fund.
Whether a worker is an employee or an independent contractor under federal or state labor laws is an increasingly urgent issue for workers and employers alike. It’s been heightened by the emergence of so-called “gig economy” businesses, including ride-sharing services like Uber and restaurant and grocery delivery businesses like DoorDash and Instacart.
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Amazon gets audited
After Amazon expelled a driver in 2017, the man filed for unemployment compensation. Independent contractors don’t qualify for jobless pay, but the filing prompted DWD to audit the delivery partner program.
The audit concluded that out of more than 1,000 participants, only two were established delivery companies that qualified as legitimate independent contractors. DWD told Amazon in 2018 that the company owed the state $205,436 in unemployment insurance premiums and penalties for workers who should have been counted as employees instead of independent contractors.
A DWD administrative law judge agreed with the department that the vast majority of Amazon Logistics’ delivery partners didn’t qualify as independent contractors under Wisconsin law.
The state law requires that to be classified as an independent contractor a worker must be free from an employer’s “control or direction,” administrative law judge Lisa Gilmore wrote in her June 2019 decision. In addition, the worker must meet at least six of nine other conditions that demonstrate “economic independence and entrepreneurial risk.”
Gilmore’s decision found that while the delivery partner program met four out of five conditions related to employer control, it only met one of the conditions for independence and risk.
The state Labor and Industry Review Commission (LIRC) largely affirmed the decision. When Amazon appealed in Waukesha County Circuit Court, the judge overturned the LIRC ruling, however — siding with Amazon that the company had cleared all of the law’s requirements.
In an April 2023 ruling, judges for the Wisconsin Appeals Court District 4 reversed the lower court. The three appellate judges found that Amazon Logistics had met five of the nine independence and risk conditions — not six, as state law requires — making the delivery partner drivers employees.
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State’s highest court to weigh if Amazon delivery drivers are independent contractors or employees was originally published by the Wisconsin Examiner.
Read the full story at Court Will Decide If Amazon Drivers Are Really Independent Contractors » Urban Milwaukee