People in New York who work in gig economy jobs, such as drivers for companies like Lyft and Uber, might get more protection if a ruling in the California Supreme Court is followed by other states. The case before the court there involved a delivery company called Dynamex. In 2004, the company changed its delivery drivers from employees to independent contractors. In a lawsuit filed by some workers, they argued that they should still be classified as employees since they worked exclusively for Dynamex and the company controlled their pay rates, their assignments and what they wore.
Dynamex appealed workers’ victories in lower courts, but the California Supreme Court did more than just uphold the decision. It also established a rule for determining whether a worker is an independent contractor or not. The service must be provided outside of the control of the company, it must not be part of the core business and the worker must provide services to other businesses as well.
This means that a worker who has a first-time driving job with Uber and does not work for other companies might be an employee and not a contractor unless the company can prove it is not a transportatiom service. Many companies may need to give workers more freedom or make them employees.
Misclassification of employees as contract workers is one way that employers might try to pay workers less in violation of wage and hour law. Employers might also refuse to pay overtime, withhold pay or violate worker rights in terms of pay in some other way. Workers who feel their employers are taking advantage of them in this way might want to consult an attorney to see what recourse they might have.