Legal Investigation Looks into Independent Contractor Status of Lyft Drivers

Attorneys working with ClassAction.org believe Lyft may have violated labor laws by misclassifying drivers as independent contractors instead of employees, and they’re now gathering affected workers to take legal action.

Allegations persist that Lyft drivers do not meet the criteria for a contractor classification and that the services they provide and the level of control Lyft exercises over their jobs indicate that they are really employees. By misclassifying drivers as independent contractors, Lyft could be illegally denying them certain employment benefits, such as expense reimbursement, payment for all time spent working, health coverage, paid leave and retirement contributions.

If you’ve driven for Lyft and did not live in California at the time, you may be able to take action to recover compensation for back pay and more.

Are Lyft Drivers Independent Contractors – Or Are They Really Employees?

It’s a debate that’s been going on for years, but attorneys suspect some Lyft drivers have been misclassified as independent contractors in violation of federal and state law.

There are a number of different “tests” and sets of criteria – at both the federal and state level – that can be used to determine whether a worker is an employee or a contractor; however, the level of control a company has over a worker is almost always taken into consideration. Essentially, the more control a company has over an individual, the less likely it is that they are a true independent contractor.

A number of proposed class action lawsuits filed against Lyft have argued that drivers should not be classified as contractors because of the amount of control the rideshare company exercises over these workers, among other factors.

The suits further argue that the drivers are employees because they are performing a service that’s part of Lyft’s usual course of business and that, without them, the rideshare company would not exist. In addition, the drivers cannot be independent contractors because they are not engaged in their own transportation business – and are simply wearing a “hat” for Lyft, according to the lawsuits.

How Could Lyft Drivers Be Losing Money?

It’s been argued that misclassified drivers are missing out on receiving the minimum wage for all hours worked, which includes time spent driving to pick up passengers and awaiting new assignments – in addition to time spent actually transporting riders.

Further, drivers may be getting deprived of time-and-a-half overtime wages when working more than 40 hours a week and may have been unlawfully forced to pay for business expenses, including the cost of gas, insurance, vehicle maintenance, and phone and data costs.

The attorneys also believe that Lyft drivers may have been illegally denied other employment benefits like health coverage, paid leave and retirement contributions.

Is This a Lawsuit? What Am I Signing Up For, Exactly?

You are not signing up for a lawsuit, but rather a process known as mass arbitration. This is a relatively new legal technique that, like a class action lawsuit, allows a large group of people to take action and seek compensation from a company over an alleged wrongdoing. Here is a quick explanation of mass arbitration from our blog:

“[M]ass arbitration occurs when hundreds or thousands of consumers file individual arbitration claims against the same company over the same issue at the same time. The aim of a mass arbitration proceeding is to grant relief on a large scale (similar to a class action lawsuit) for those who sign up.”

Lyft’s terms of service contain both a class action waiver and an arbitration clause requiring users to resolve disputes via arbitration, a form of alternative dispute resolution that takes place outside of court before a neutral arbitrator, as opposed to a judge or jury. It’s for this reason that attorneys working with ClassAction.org have decided to handle this matter as a mass arbitration rather than a class action lawsuit.

How Much Does This Cost?

It costs nothing to sign up, and you’ll only need to pay if the attorneys win money on your behalf. Their payment will come as a percentage of your award.

If they don’t win your claim, you don’t pay.

How Much Money Could I Get?

There are no guarantees as to how much money you could get or whether your claim will be successful. However, it’s possible that Lyft drivers who sign up for the mass arbitration may be able to recover money for unpaid wages, business expenses and other employment benefits they may have been denied.

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