Massachusetts Sues Uber and Lyft Over the Status of Drivers

Uber and Lyft ought to deal with their drivers in Massachusetts as staff with the proper to obtain advantages, as a substitute of misclassifying them as unbiased contractors, the state’s legal professional normal stated in a lawsuit filed in opposition to the ride-hailing corporations.

The swimsuit, made public on Tuesday, makes Massachusetts the second state after California to problem how Uber and Lyft classify drivers and may deal one other blow to their enterprise mannequin. Maura Healey, the state’s legal professional normal, mailed in the criticism to Massachusetts Superior Court in Suffolk County.

Uber, Lyft and different so-called gig financial system corporations have maintained that their drivers are unbiased contractors who’re ineligible for advantages like sick go away, paid time without work and unemployment insurance coverage. But the corporations are going through rising strain to reclassify drivers as staff, who would have higher recourse to push again for higher working circumstances and pay.

“Uber and Lyft have built their billion-dollar businesses while denying their drivers basic employee protections and benefits for years,” Ms. Healey stated in an announcement. “This business model is unfair and exploitative. We are seeking this determination from the court because these drivers have a right to be treated fairly.”

Massachusetts is asking the courtroom to rule that the drivers for Uber and Lyft are, the truth is, staff underneath state regulation. It can be looking for an injunction to forestall the corporations from denying drivers protections afforded to staff.

An Uber spokesman, Matt Kallman, stated in an announcement: “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.”

“This lawsuit threatens to eliminate work for more than 50,000 people in Massachusetts at the worst possible time,” stated Julie Wood, a spokeswoman for Lyft. “Drivers don’t want this — most drive only a few hours a week, and they have chosen to drive using Lyft precisely because of the independence it gives them to make money in their spare time.”

Although the Massachusetts regulation was enacted in 2004, the state had not tried to implement it in opposition to Uber and the different gig financial system start-ups which have disrupted transportation, hospitality and meals supply over the final decade. Instead, Uber drivers in Massachusetts have sought employment standing via particular person lawsuits and class actions, however many of these circumstances have been pushed into arbitration or are nonetheless making their means via the courtroom system.

The state is suing now as a result of of the coronavirus pandemic, officers in the legal professional normal’s workplace stated. Employment protections like paid sick go away, medical health insurance and assured revenue are particularly useful throughout a worldwide well being disaster. Uber and Lyft have stated they are going to present drivers with monetary help for as much as 14 days in the event that they take a look at optimistic for the virus or are pressured to remain residence. Demand for rides has plunged throughout the disaster, nevertheless, curbing the skill of many drivers to earn an revenue.

Some drivers welcomed the lawsuit and stated it may enhance working circumstances. “I believed the lie. I thought I was an independent contractor with my own business, but Uber and Lyft controlled how much I got paid, where I drove,” stated Felipe Martinez, the chairman of the Boston Independent Drivers Guild, a gaggle that advocates on the behalf of Uber and Lyft drivers. “I realized I was an employee in disguise.”

Uber and Lyft are additionally preventing a legal battle in California, where the state attorney general and the city attorneys of San Francisco, Los Angeles and San Diego sued the companies to enforce a state law, known as Assembly Bill 5, that defines gig economy workers as employees.

Massachusetts and California use similar legal tests to determine whether workers are independent contractors or employees. Laws in both states say a worker should be classified as an employee if the employer controls the worker’s wages and schedule, the worker performs a service that is a core part of the employer’s business and the worker does not have an independently established business doing similar work.

Uber has argued that its core business is technology, not rides, and therefore drivers are not a key part of its business. It has also tweaked its service in California since A.B. 5 went into effect on Jan. 1, allowing drivers to see fares upfront and reject low-paying rides without paying a penalty.

Uber, Lyft and DoorDash have also poured tens of millions of dollars into Proposition 22, a measure on the November ballot in California that, if passed, would exempt them from the state’s labor law.

“We couldn’t be more pleased to have Massachusetts join us in this fight to protect vulnerable workers,” said Dennis Herrera, the city attorney of San Francisco. “Under the law, their drivers are employees, plain and simple.”

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