New York Sues Uber, Lyft over Misclassification

July 17, 2020

Massachusetts joined California as the second state to file suit against Uber and Lyft over the status of its drivers, claiming the ridesharing companies are misclassifying their drivers as independent contractors in violation of state law.

“Uber and Lyft have built their billion-dollar businesses while denying their drivers basic employee protections and benefits for years,” said Maura Healey, the state’s attorney general, who filed the lawsuit in Massachusetts Superior Court on Tuesday.  The lawsuit claims that Uber and Lyft drivers are employees under Massachusetts state law, which has a test for employee status similar to California’s “ABC” test.  Massachusetts seeks both a ruling that the drivers are employees and an injunction preventing Uber and Lyft from denying the drivers protections and benefits.

Uber and Lyft warn of drastic consequences of employee classification:  “This lawsuit threatens to eliminate work for more than 50,000 people in Massachusetts at the worst possible time…drivers don’t want this,” claimed Julie Wood, a spokeswoman for Lyft.  Uber, Lyft, and DoorDash have already spent tens of millions of dollars on a California ballot measure which, if passed, would exempt them from the state’s misclassification statute. 

Outlook: Massachusetts’ lawsuit is merely the latest episode in the lengthy battle over independent contractor status occurring on both the state and federal level.  New York is currently considering whether to adopt its own version of the so-called “ABC” test and could join California and Massachusetts in forcing the major gig companies into classifying their workers as employees.  Meanwhile, the PRO Act, which passed the House this past winter, would codify the “ABC” test into federal labor law.