Grub-Hub Drivers Officially Ruled Contractors and The Gig-Economy is Taking Notice

A recent ruling declared Grub-Hub drivers independent contractors officially and the gig-economy is taking notice. The ruling has the potential to affect Uber litigation as it is also hinging on employment status questions. The significant court decision was handed down by a federal judge asked to rule whether drivers for GrubHub Inc. are actually independent contractors or employees. Since Uber Technologies Inc. has a similar business model that depends on pairing customers with products/services through a smart phone app, it’s not surprising that employment law litigation facing both parties includes similar issues.

The first of its kind ruling was delivered by U.S. Magistrate Judge Jacqueline Scott Corley in San Francisco. According to the ruling, a gig-economy driver does not qualify for employee protections under California law. Her ruling was based on her interpretation of California law on the matter. She did note that the law, as it stands, is an all-or-nothing proposition and the advent of the gig economy’s low wage workforce engaging in low skill, high flexibility, episodic jobs may mean the legislature will need to readdress the issue. 

The GrubHub suit was filed by Raif Lawson. Lawson worked as a food-delivery driver for less than six months while he pursued an acting/writing career. He claimed GrubHub violated California labor laws by not reimbursing him for expenses, failing to pay minimum wage and failing to pay overtime pay for hours worked in excess of either per day or 40/week.

Determining whether Lawson was an independent contractor or an employee hinged on pinning down how much control GrubHub exerts over their drivers’ work lives. GrubHub argued that Lawson held the reins as he decided when, where and how frequently he performed deliveries. Lawson’s attorney contended that GrubHub exerted control over drivers by expecting them to be available to accept assignments during shifts they sign up for and to remain in prescribed geographical regions.

GrubHub is happy with the ruling, as are many other gig-economy front runners facing similar litigation and questions of misclassification. They feel the ruling validates the freedom that GrubHub drivers enjoy. They also stated that the would make sure drivers would retain the advantage of flexibility that made working with GrubHub advantageous.

If you have questions about misclassification in the work place or if you need the help of an experienced California employment lawyer, get in touch with Blumenthal Nordrehaug Bhowmik De Blouw LLP.

NY Times Facing Discrimination & Misclassification Claims

Robert Stolarik, a photographer with an extensive working relationship with the New York Times, filed a lawsuit against the newspaper. He alleges that the New York Times misclassified him on the job, discriminated against him due to age, denied him assignments due to a past arrest, and retaliated against him when he made these claims public. During the course of his career as a photographer, Stolarik has had his photos featured on the front page of the New York Times over 30 times.

Stolarik filed the lawsuit on July 6th in the U.S. District Court for the Southern District of New York. He included a number of different accusations:

Classification as a freelancer instead of a full-time employee, which left him responsible for paying additional taxes and ineligible for the company’s benefits and retirement plan. Stolarik claims the editors referred to him as a “full time freelancer” for 14 years.

No overtime pay despite working close to 3,400 hours in overtime from 2005 through 2009.

When seeking to become a staff photographer/employee, Stolarik was told a number of times by different editors at the paper that his age (37 in 2006) prevented his hiring as a staff shooter. During that same time period, younger photographers (20-somethings) were hired on as staff photographers.

In August 2012, Stolarik was assaulted and arrested while covering a story in the Bronx. The Times made sure Stolarik had legal representation and submitted an angry letter to the NYPD about the incident. The officer was later charged and found guilty of a felony for lying about the arrest. Yet Stolarik was taken off the police beat (that he had covered for more than 10 years) in response to the arrest.

Stolarik claims that the unlawful and discriminatory practices of the New York Times resulted in a loss of income and benefits because he was denied both a staff position and freelance assignments. In addition, Stolarik claims the paper retaliated against him when he submitted a letter including these legal complaints to the paper in spring of 2016. Since that time, he has not received a single assignment from the paper’s editors.

If you have experienced workplace retaliation or you don’t know what to do about discrimination in the workplace, please get in touch with one of the experienced California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Time Warner Cable Allegedly Misclassified California Installation Techs

California installation techs involved in a suit against Time Warner Cable won collective action certification and partial class certification in California federal court. Plaintiffs allege Time Warner Cable misclassified California installation techs as contract workers to avoid paying overtime wages and provide benefits. California District Judge Beverly Reid O’Connell rules that the installation techs (employed by Multi Cable, Inc. under a partnership with Time Warner Cable) were eligible for class certification for claims that they were paid as “faux independent contractors” from 2011 through 2015. 

The class in this case is represented by Luis Luviano, installation technician. As a group, the class claims that Time Warner Cable and MCI (California company contractually obligated to supply IT services for the cable company), regularly required techs to work overtime without appropriate overtime pay. Employees were also allegedly required to purchase tools and equipment without reimbursement due to erroneous classification as contract workers. The classification was in spite of control over duties and job completion exercised by the company that was allegedly indicative of an employee/employer relationship.

The technicians in the class described control exercised over them as “contractors” to include every aspect of the job from mandatory uniforms to the hours worked to the tools and materials used for the job to decals applied on workers’ vehicles. IT workers also allege that the compensation scheme used by the company was unnecessarily complicated with pay based on both the number of installations completed and the customer satisfaction ratings received based on their performance. Techs claim that the pay system resulted in an inability to predict how much pay they could expect to receive for their work as well as making it close to impossible to verify the accuracy of pay received.

Time Warner Cable attempted to argue against the validity of the suit claiming that workers making allegations failed to establish that there was, in fact, a co-employer relationship between Time Warner and MCI, but the judge ruled that there was sufficient cause to merit further argument at trial.

Both companies involved (Time Warner and MCI) attempted to quash class certification claiming that Luviano was not a reliable representative. The companies claimed that Luviano obtained his position using a false name and social security number and that he lied about his arrest record during his application process and during depositions. O’Connell ruled that Luviano could represent the class, but allowed it on the condition that a replacement be named in the event he was eventually disqualified. The matter does raise well founded credibility issues, and could negatively impact the chances of the class prevailing on its claims, but the court does not find that one plaintiff’s (even if he is the class representative) inadequacy renders the representation as a whole inadequate as one inadequate representative plaintiff is replaceable.

If you have questions regarding misclassification or if you feel you have been misclassified in order to denied overtime pay or benefits, please contact one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik. 

Teamsters Object to $27 Million Lyft Deal, but are Rejected

Katie when teamsters’ objected to the proposed $27 million settlement between Lyft and the class of 163,000 California drivers, their objection was rejected by a federal judge. But the same judge also delayed finalizing the proposed deal.

The case has been all over the news and many have heard bits and pieces as the proceedings proceed. To recap, the Uber Lyft Teamsters Ride Share Alliance (known as ULTRA) filed a brief opposing the deal in October. Claims were made that the proposed settlement fails to adequately compensate full-time drivers and also forces workers to waive their right to sue the company due to Fair Labor Standards Act violations. During settlement approval, the U.S. District Judge Vince Chhabria appeared to become frustrated when the objecting attorney did not provide specific information supporting his argument that the deal should be rejected. The attorney argued that doubling compensation for individuals who driver 30+ hours per week for Lyft was not adequate because that would leave part-time drivers with a fairly high compensation for their work in comparison to full-time drivers. Yet could not tell the judge what he suggested an appropriate multiplier should be for full-time workers.

A similar argument occurred when the attorney suggested more data would be necessary in order to come up with such a number and the judge asked what data was necessary only to have the attorney unable to say precisely what data he would need to calculate the needed number.   

Other issues discussed during the proceedings were: the settlement provision shielding Lyft from lawsuits over alleged Fair Labor Standards Act (FLSA) violations and the workers’ right to opt in to waive their rights to sue, the addition of the condition post- Cotter v. Lyft suit, and appropriate (and timely) notification to workers of the settlement terms and their rights to opt out or object to the deal, the inability to access the actual text of the agreement online, and adequate time for class members to object to the motion for attorneys’ fees (13.6% or $3.67 million in fees), objections regarding Lyft policy and procedure being inadequate in the case of a deaf driver,

According to attorney for the plaintiffs in the class action lawsuit against Lyft, 84,000 drivers (or 51% of the class) have filed claims for reimbursement so far. As of mid-November, attorneys estimated that drivers who drove over 2,000 hours for the rideshare service since May 2012 should receive distributions of about $11,000 for vehicle expenses reimbursement and unpaid overtime wages. As part of the settlement, drivers would agree to waive their claims that Lyft misclassified them as independent contractors in order to be denied employment benefits. Drivers may continue to submit claims for a portion of the settlement up until the first distribution is allocated to drivers in the class, which should occur about six months after final approval of the settlement is granted by the judge.

For additional information about overtime pay, overtime pay violations or class action certification, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Flight Attendants Win Class Certification in Pay Suit Against Virgin America

In November 2016, about 1,400 Virgin America flight attendants won class certification from a California federal judge. Their suit includes allegations that Virgin America airline shorted flight attendants on wages for time spent before and after flights, which is a violation of California labor law.

U.S. District Judge Jon S. Tigar issued the order certifying a class of approximately 1,400 California-based flight attendants employed by the airline since March of 2011. Virgin America airline was against class certification, stating that California wage law did not apply extraterritorially. This argument was, at least in part, negated by the judge’s creation of a subclass in the certification for California residents who have temporarily left the state in the course of their job duties. Judge Tigar stated clearly that while the law is not settled regarding the applicability of California wage and hour laws to work of California residents outside of the state, but that members can recover unpaid wages for time worked within that state. As every member of the California resident subclass is also a member of the proposed class, the court found certification appropriate. If, later in the case, the court determines that members of the California resident subclass are only eligible to recover payment on hours when their primary job location was California, these members can be easily identified through Virgin’s employment documentation.

The argument presented by the flight attendants in the case is that Virgin does not provide payment for the time before and after flights, during which they are required to write up incident reports, complete training, undergo required drug tests, etc. It was also alleged the Virgin does not provide flight attendants with employment law mandated meal and rest breaks, overtime pay, minimum wages and accurate wage statements. While flight attendants at many of the major airlines are unionized, the Virgin America workers are not. This means they do not have any union protection. They have to rely on the protection of the law.

Currently, Virgin America provides payment to flight attendants based on a “block time” pay schedule based on the time between leaving and arriving at the gate. Work performed outside of this specific time is not compensated. These activities include: pre-flight briefings, passenger boarding and deplaning, etc. Yet the company does provide standard allocation of 30 minutes for drug screening time (regardless of the actual time spent on the test) and four hours of pay for reserve shifts when flight attendants are not assigned a flight (but these airport reserve shifts can last up to six hours).

If you have questions about class certification or what constitutes a violation of employment law, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik. 

Two Austin Drivers Accuse Uber of Wrongful Termination

In May, Uber Technologies, Inc and Lyft, Inc. abruptly removed their services from Austin, Texas. As a result, thousands of drivers in the area lost their jobs. Two of those former drivers, Todd Johnston from Uber and David Thornton from Lyft, filed two proposed California class action lawsuits. In response to new regulations that were implemented, the two companies moved out of Austin, Texas.

The plaintiffs’ attorney indicated that the success of the suits depend upon the same common issue that Uber and Lyft have been battling in various forums: the question of whether drivers are misclassified as independent contractors. The two previous drivers cited the Worker Adjustment and Retraining Notification Act (WARN) as a basis for their lawsuits. According to the statute, employers who have 100 or more employees working 20 or more hours a week (on average) must provide 60 days notice before a mass layoff or plant closure resulting in a mass layoff. The goal of this particular legislation was to provide workers with the opportunity to find alternative employment, find and arrange for any necessary or advantageous retraining, make accommodations for loss of pay, etc.

The plaintiffs claim that Uber and Lyft’s departure from Austin, Texas resulted in 10,000 drivers contracted to operate in the city being “laid off.” According to the wording in the above cited statute, this type of action (resulting in the “laying off” of more than 500 workers) calls for an appropriate notification. Legal experts viewing the case indicate that the plaintiffs face an uphill battle as for the statute to apply to the situation, laid off workers must have been “employees.” Uber and Lyft classify their drivers as independent contractors – a classification that comes with significantly different rights and benefits in comparison to workers classified as employees.

In April an unrelated lawsuit reached a settlement with terms dictating that drivers are to be considered independent contractors – not employees. Having noted that, we have yet to see a definitive court ruling on this particular issue. So while it will be an uphill battle for these plaintiffs to establish themselves as “employees” of Uber and Lyft in the eyes of the court, the possibility is there.

If you have questions regarding what constitutes a misclassification, please get in touch with one of the experienced employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Drivers’ Employment Status Leaves Uber Being Sued…Again!

Uber is being sued again. The question of the Uber drivers’ employment status has opened the class action floodgates. Within two weeks of the settlement of $100 million for class action lawsuits in California and Massachusetts that sought driver reclassification from independent contractors to employees, Uber is fielding two new cases against their company.

Following the California and Massachusetts case resolution, similar nationwide class-action lawsuits have been filed on behalf of Uber drivers in both Florida and Illinois courts. The drivers (plaintiffs) allege that Uber, a San Francisco company, is in violation of the Fair Labor Standard Act. The new suits seek unpaid overtime wages and work-related expenses on behalf of drivers.

The class action suit that was filed in Illinois takes the familiar allegations to a new level by attempting to recover tips that drivers earned which they allege the company stole from them or caused them to lose through Uber policies and communications.

Legal representation for the Illinois class action lawsuit indicated that the settlement with California and Massachusetts drivers was an obvious attempt by Uber to band aid the situation when it called for much more drastic methods. Many drivers who work using the Uber service do so as a means of supporting themselves and their families. They need the protection of wage and hour laws and overtime pay requirements, just as much as the rest of the workers in the nation.

Uber responded to the new legal activity with a statement indicating that 90% of their drivers work with Uber because they enjoy being their own boss and that the reclassification of drivers from independent contractors as employees would take that away from them. They would no longer have the flexibility that the status of independent contractor affords. Uber “employees” would have designated shifts, a fixed hourly wage that would limit their earnings, and prohibitions would keep them from driving for additional ride-sharing apps.

If you have questions about the misclassification of workers or if you are an independent contractor and have questions about misclassification of employees, please get in touch with the southern California employment law attorneys at Blumenthal, Nordrehaug and Bhowmik.