Uber drivers have filed suit in Massachusetts, claiming that the company has illegally categorized drivers as independent contractors rather than employees, depriving them of legal protections covering wages and benefits.
The drivers state that they should be recognized as employees under the Fair Labor Standards Act (FLSA), a federal regulation that governs minimum wage and overtime eligibility, as well as Massachusetts employment law.
As independent contractors, the drivers state, they make approximately $8/hour, far less than the $12/hour minimum wage. They are not eligible for overtime payments, sick leave, or unemployment benefits. Should the courts decide that Uber drivers are employees, rather than independent contractors, the drivers will be covered under federal and state employment law, and will be eligible for all the benefits thereof.
The plaintiff’s attorney, Travis Lenkner, told the Boston Herald that “Uber treats all of its drivers like independent contractors even though they provide the core service, which is transportation. By doing that,” he continued, “Uber gets to evade minimum wage, overtime, and sick leave laws.”
In Massachusetts, employers are required to complete a three-part test to determine whether or not an employee is an independent contractor. An independent contractor’s work is:
without the direction and control of the employer
- Performed outside the usual course of the employer’s business (hence Mr. Lenkner’s reference to drivers performing the core service of transportation)
- Completed by someone who has their own independent business or trade
The Massachusetts lawsuit may turn on what the court finds the “core business” of Uber to be. Uber may argue that its business is not providing rides (“transportation”) – but instead is the business of managing proprietary software that matches drivers and passengers. The software has many features including a rating system where riders and drivers rate one another, and a payment system to facilitate payments to drivers.
A similar suit in California resulted in a redefinition of that state’s independent contractor test, making it more difficult for Uber and other ride-sharing companies to categorize drivers as independent contractors. However, Uber won a victory in California, with the court upholding the company’s right to require employees to seek arbitration individually rather than file class action suits against the company.
In New York, Uber drivers were found to be employees, for purposes of collecting unemployment.
However, a U.S. judge in Philadelphia found that UberBLACK limo drivers are independent contractors under federal law. The court decided that since UberBLACK drivers may set their own hours, working as much or as little as they want, and have discretion over conducting personal business while working, they meet the definition of independent contractors.
If you are an employer or an employee with concerns about employee classification or the payment of wages, The Brown Law Firm can help. Call us at (617) 489-0817 for a confidential consultation.