Lyft, Inc. is facing a proposed class action lawsuit in Massachusetts over its alleged misclassification of drivers as independent contractors. Seemingly spurred by changes in standards for independent contractor status, the suit is the latest in a long line of litigation against Lyft and competitor Uber over the classification of workers who contend they should be considered bona fide employees entitled to certain benefits and protections.
Massachusetts law requires an individual who performs services for a company be considered an employee unless the following conditions are met:
“The individual is free from control and direction in connection with the performance of the service, both under his contract for the performance of service and fact; and”
“The service is performed outside the usual course of the business of the employer, and”
“The individual is customarily engaged in an independently established trade, occupation, profession or business, of the same nature as that involved in the service performed.”
According to the complaint, Lyft drivers fail to meet these conditions and therefore should be considered employees. The case claims that the defendant exerts a significant amount of control over drivers in that it sets rates of pay, mandates that workers meet certain professional standards or face termination, and requires drivers to maintain certain acceptance and customer satisfaction ratings.
Furthermore, the suit claims that drivers are not engaged in an “independently established business or occupation” while working for Lyft since the defendant does not allow customers to request specific drivers. Finally, the lawsuit stresses that the work performed by Lyft drivers is done within the company’s usual course of business, and that such work is the very backbone of the defendant’s operations. From the case:
“Drivers perform a service in the usual course of Lyft’s business, since Lyft is a car service that provides transportation to its customers, and drivers such as plaintiff perform that transportation service. Lyft holds itself out as a transportation service, and generates its revenue primarily from customers paying for the very rides that its drivers perform. Without drivers to provide rides for Lyft’s customers, Lyft would not exist.”
Since Lyft considers its drivers independent contractors, the rideshare company does not provide these individuals with the benefits available to employees, according to the suit. Specifically, the complaint claims the defendant fails to pay minimum and overtime wages; the company also allegedly fails to provide insurance or reimbursement for business expenses such as gas and car maintenance costs. The case argues, however, that since Lyft drivers are in truth employees, the defendant should be required to provide the aforementioned benefits.
The suit seeks a declaratory judgment that Lyft drivers in Massachusetts be classified as employees, along with compensatory damages for all wages and expenses owed, as well as treble damages for all wage law violations.