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Are GrubHub's drivers employees or contractors?

You may choose to drive for a delivery service like GrubHub, Postmates or DoorDash to earn a little extra cash on top of a regular job. Or, like many drivers, driving for one of these companies may be how you make the bulk of your income.

If you depend on a single company for a large part of your income, it matters whether you are classified as an employee or contractor: as an employee, you are eligible for overtime pay, benefits and other protections that contractors are not eligible for.

However, most companies in the gig economy classify workers as independent contractors - which some workers think is unfair. GrubHub is the latest of companies with an "on-demand" workforce of drivers to face a legal challenge to how it classifies its employees.

Why the GrubHub trial is significant

In Lawson v. GrubHub Holdings, Inc., two former delivery drivers are arguing that the company misclassified them as independent contractors and owes them overtime pay, as well as reimbursement for expenses and other damages.

GrubHub is arguing that the drivers were correctly classified as an independent contractor because they had control over their own hours and other aspects of the job. Furthermore, the company says the drivers are not engaged in a core aspect of the business: COO Stan Chia testified that GrubHub does not consider itself a "food delivery company," according to TechCrunch.

While several similar cases have been brought against other tech companies such as Uber and DoorDash for misclassifying drivers as independent contractors, the lawsuit against GrubHub is the first of its type to get to trial instead of reaching a settlement out of court. The result will likely have implications for other companies and their drivers as well. A ruling could come as early as November.

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