Federal judge rules GrubHub drivers are contractors

Federal judge rules GrubHub drivers are contractors
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A federal judge ruled on Thursday that GrubHub drivers are contractors, not employees, in a decision that could have implications for other “gig-economy” companies like Uber and Lyft

Such companies rely on profitable business models in which they hire drivers and other gig workers as independent contractors, allowing them to sidestep regulations that would force them to provide the same benefits that they would for full-time employees.

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“Under California law whether an individual performing services for another is an employee or an independent contractor is an all-or-nothing proposition,” U.S. Magistrate Judge Jacqueline Scott Corley in San Francisco wrote in her decision.

“While some factors weigh in favor of an employment relationship, Grubhub’s lack of all necessary control over Mr. Lawson’s work, including how he performed deliveries and even whether or for how long, along with other factors persuade the Court that the contractor classification was appropriate for Mr. Lawson during his brief tenure with GrubHub.”

Corley suggested that lawmakers consider resolving the “stark dichotomy” of the new “low wage workforce performing low skill but highly flexible episodic jobs.”

Raef Lawson filed the case against GrubHub, claiming that the food-delivery app broke California labor laws by paying below minimum wage, not paying overtime and not providing compensation for work expenses.