Page 20 - CLT072020

S-20 ¦ JULY 20, 2020 INSURANCE LAW

Massachusetts Sues Uber and
Lyft Over Driver Classification

By Hannah Smith

This week, Massachusetts followed in Califor- In a statement, Uber stated that it would contest
nia’s footsteps and sued Uber Technologies Inc, the action in court, and said it would work with the
and Lyft Inc, over the alleged misclassification state to modernize laws that allow for new worker
of drivers as independent contrac- protections while maintaining
tors instead of employees which flexibility. Lyft, in a statement, said
would be entitled to benefits. that drivers would not automati-
The complaint was filed in Suf- This week, cally be hired as employees, so the

folk Superior Court and claims Massachusetts followed in suit threatens to eliminate work
that the ride-sharing companies’ California’s footsteps and for more than 50,000 workers.
current classification of the driv- Editors Note: A business may
ers violates state minimum wage, sued Uber Technologies pay workers and independent
hour, and sick-time laws. Inc, and Lyft Inc, over the contractor for the same work,
alleged misclassification but there are some important le-
The Massachusetts Attorney gal differences. For an employee,
General stated that Uber and Lyft of drivers…

have built billion-dollar busi- the company withholds income
nesses on the backs of drivers who tax, Social Security, and Medicare
were denied basic employee pro- from the wages that are paid. An
tections and benefits. Uber and Lyft both argue that independent contractor does not have taxes with-
their drivers enjoy the flexibility that comes with on- held and pays their own business expenses and
demand work. health insurance.
¦

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