Drivers for Lyft and Uber have long been classified as independent contractors, but for just as long, there have been disputes over that classification. Why? Independent contractors generally do not receive the employment protections and benefits afforded to employees.
Recently in California, a driver for Lyft sued the ridesharing company for these very reasons, citing multiple wage and breaks violations. Specifically, the driver is suing the company for depriving drivers of certain wages, meal and rest breaks, overtime pay and reimbursement for work-related expenses.
While Lyft claims that its drivers are independent contractors, the lawsuit points out that the “independent contractor” classification doesn’t meet California’s “ABC” test for such classifications. Under California law, employers must prove three criteria to classify workers as independent contractors. But the lawsuit claims that Lyft can’t even meet one of the criteria.
From an employment law perspective, multiple factors would seem to invalidate the claim that Lyft drivers are independent contractors. The following factors appear to support the claim that Lyft drivers are employees:
- Lyft exerts significant control over the manner and method of the drivers’ work duties.
- Drivers are required to use Lyft’s mobile app, which tells drivers where to go and which riders to pick up.
- Lyft sets its drivers’ compensation and maintains the right to deduct a portion or all of a fare if a rider complains about a driver.
- Drivers are required to meet certain standards of conduct and terms of service that are determined by Lyft.
- Lyft provides bonuses and “prime time pricing” to direct when, where and how drivers work.
- Generally, according to the lawsuit, the Lyft drivers don’t provide transportation services outside of working for Lyft.
Lyft claims that it is only a technology platform, but the reality is that riders don’t use the Lyft app for anything other than obtaining transportation services. The lawsuit says that this fact further indicates that the drivers are employees of Lyft.
Important to note: the driver who filed a lawsuit had opted out of Lyft’s arbitration agreement, which otherwise might have prevented him from bringing a lawsuit. Under the Private Attorneys General Act (PAGA), the driver sued the company individually and on behalf of other aggrieved employees. For more on PAGA, please see our overview of class actions and representative actions.