Massachusetts has become the second state to file a lawsuit against Uber and Lyft over rideshare driver classification, on the heels of a similar legal challenge in California.
Lawsuit Challenges Rideshare Driver Classification
Massachusetts Attorney General Maura Healey filed suit against the two leading rideshare companies on July 14, 2020. The lawsuit alleges that Uber and Lyft wrongfully classify their drivers as independent contractors rather than as employees, a rideshare driver classification the companies have consistently resisted. Critics say Uber and Lyft are attempting to reduce expenses and avoid providing many traditional employee benefits, such as guaranteed minimum wage, workers’ compensation, overtime payments, unemployment, health insurance, and retirement accounts.
“The bottom line is Uber and Lyft have gotten a free ride for far too long,” Healey said in a video message announcing the lawsuit. “For years these companies have systematically denied their drivers basic workplace protections and benefits, and profited greatly from it. This business is unfair and it’s also illegal under Massachusetts law.”
Massachusetts Second State to Sue Over Issue
The lawsuit makes Massachusetts the second state to sue Uber and Lyft over rideshare driver classification. In May, California Attorney General Xavier Becerra and the city attorneys of Los Angeles, San Francisco, and San Diego filed suit against the companies, arguing that their drivers should be employees under the state’s AB5 law that went into effect at the beginning of the year. Becerra also recently filed a motion for a preliminary injunction that would compel rideshare companies to reclassify drivers as employees within a matter of weeks.
Additionally, the California Public Utilities Commission ruled in June that drivers for “transportation networking companies” such as Uber and Lyft should be defined as employees rather than independent contractors.
Even before these recent legal actions, Healey had signaled that Massachusetts would likely go after Uber and Lyft over rideshare driver classification. In March, her office filed an amicus brief in federal court urging a judge to order the companies to reclassify their drivers as employees and provide them with paid sick leave, arguing that it could help stop the spread of COVID-19.
Companies Emphasize “Freedom” Despite Driver Complaints
Ironically, Uber and Lyft are now using the coronavirus pandemic to argue that challenges to rideshare driver classification are putting jobs at risk.
“At a time when Massachusetts’ economy is in crisis with a record 16 percent unemployment rate, we need to make it easier, not harder, for people to quickly start earning an income,” said an Uber spokesperson. “We will contest this action in court, as it flies in the face of what the vast majority of drivers want: to work independently. We stand ready to work with the state to modernize our laws, so that independent workers receive new protections while maintaining the flexibility they prefer.”
Uber and Lyft have persistently argued that their drivers prefer to be classified as independent contractors because of the flexibility it provides them to set their own hours and drive for multiple apps.
“They’re their own boss,” Uber CEO Dara Khosrowshahi said last year. “They run their own business.”
Despite these claims by the companies, many drivers for Uber and Lyft have long complained about inadequate pay, lack of protections, and their inability to form unions to effect positive changes. A number of drivers have spoken about sleeping in their vehicles because of their inability to live in the cities where they work, about their struggles to make ends meet, and about the helplessness that they feel over being at the mercy of an algorithm that determines their every move.
“For years Uber and Lyft have built their billion-dollar businesses on a model that exploits drivers,” Healey added in her video announcement. “Uber and Lyft set the rates. They alone set the rules. Drivers are employees.”
Are You a Misclassified Worker?
Workers’ compensation claimants face many obstacles, particularly if they are misclassified as “independent contractors,” a designation that could deny them legally mandated benefits for injuries sustained on the job. To help overcome these obstacles, many workers have sought out the assistance of the Chicago workers’ compensation attorneys at GWC Injury Lawyers LLC.
With over $2 billion recovered in verdicts and settlements on behalf of our clients, GWC is one of the premier Workers’ Compensation and Personal Injury law firms in Illinois. For more than four decades, our dedicated Chicago workers’ compensation lawyers have been fighting for the rights of injured people in virtually every profession. GWC has the experience, the determination, the resources, and the well-earned reputation of success necessary to get you and your family the justice you deserve.
If you have been hurt in the workplace, please contact GWC today to schedule a free, no-obligation consultation with one of our attorneys. You may call our office at (312) 464-1234 or click here to chat with a representative at any time.