Now that sports betting has been legalized by the Supreme Court, I might want to consider laying some action on an upcoming game, because I am on fire with my recent predictions. In a blog post from last week, I correctly predicted the two arguments that Grubhub would be making in response to the plaintiff’s argument that the trial victory should be wiped off the books and returned to the lower court for further proceedings. Late last night, the gig economy company filed a brief with the 9th Circuit Court of Appeals in an attempt to preserve its momentous trial victory.
The ink on the Dynamex court decision is barely dry, but plaintiffs’ attorneys are not wasting any time in taking advantage of the new misclassification standard established for California businesses. In a pair of lawsuits filed on May 8 in a San Francisco state court, workers for both Lyft and Postmates filed claims alleging they were improperly classified as contractors. The lawsuits each use specific language aimed at conforming to the new ABC test established by the California Supreme Court. Specifically:
Late Friday afternoon, the attorneys for the worker who came out on the losing end of the Grubhub misclassification trial asked the appeals court to return the case to the lower court for a new hearing. Their reasoning? Last week’s momentous Dynamex ruling by the California Supreme Court changed the standard that courts should follow when making a classification determination between employee and independent contractor, and the plaintiff wants the court to take a fresh look at the case with this new standard in mind. This maneuver was all but inevitable, and gig companies around the country (but especially in California) should pay close attention to the proceedings to see how this development might impact them.
May the 4th has become known as Star Wars Day given the movie franchise’s most famous tag line. Today provides an opportunity for us to examine a recent employment law development of massive significance—a great disturbance in the Force, if you will—and how it would impact Star Wars characters if they were subject to modern misclassification principles.
My colleague Ashton Riley described it as the “contractor apocalypse.” Yesterday the California Supreme Court issued its long-awaited decision in Dynamex Operations West, Inc. v. Superior Court, and, unfortunately, the wait wasn’t worth it. The state Supreme Court scrapped the flexible legal test used since 1989 to determine whether a worker was an independent contractor or employee and installed a rigid three-pronged test that will appear in the nightmares of your average gig economy business executives for the foreseeable future.
A delivery driver for gig economy company DoorDash has been ordered by the 5th Circuit Court of Appeals to take his misclassification case to a private arbitrator instead of court pursuant to a valid arbitration agreement he entered into. The April 25 decision is a solid win for gig employers and could provide a template for how other similar businesses should structure their own arbitration agreements.
According to a recently released study by American Express and Institutional Investor, we can expect to see a slight increase in the use of freelancers and contract workers in the year ahead.
I wrote an article last week about a Pennsylvania federal court victory for Uber, repelling a misclassification attack from several drivers who claimed they should have been considered employees. You can read the full summary here.
At the forefront of mind of every gig economy company is the troublesome question of whether its workers are properly classified as independent contractors. Just search our blog for cases involving “misclassification” and you’ll see dozens of examples of cases touching on this subject. It’s always a good idea to stay on top of the latest decisions involving misclassification questions; for this reason, here’s a review of three recent cases from across the country dealing with this issue. Two of them turned out favorably for businesses (you win some), and one of them turned out poorly (you lose some). Reviewing them will hopefully shed further light on the misclassification question and provide some guidance on operating your gig economy company.
We knew we hadn’t heard the end of this case, but today it’s official: the worker who lost what is believed to be the nation’s first-ever gig economy misclassification trial last month has filed an appeal with the 9th Circuit Court of Appeals.