Patrick Miller-Bartley
Tue, 04/11/2023
A federal judge in California ruled on March 31st that Grubhub misclassified a former delivery driver, Raef Lawson, as an independent contractor and therefore improperly denied him minimum-wage pay. The court also held that Mr. Lawson was qualified to receive overtime pay, but that he had not worked over 40 hours in any given week.
Under both federal and state labor law, so-called “independent contractors” are exempt from various labor protections, including minimum-wage and overtime requirements. Companies often attempt to misclassify their employees as independent contractors in order to avoid paying them. There are a variety of standards and tests used across jurisdictions to determine whether or not workers are truly independent contractors or just employees by another name, and the determination is often quite technical. An experienced labor lawyer can help you determine whether you are properly classified and, if not, help get you the pay that you are owed.
In Mr. Lawson’s case, the court’s decision relied on California Labor Code § 2775, which establishes that workers are employees by default and may only be considered independent contractors if they: (1) are able to control and direct their own work; (2) perform work that is outside the usual course of business for the company paying them; and (3) are primarily engaged in an independent trade, occupation, or business. The court held that, among other things, the act of delivering food was not outside the usual course of Grubhub’s business, and rejected Grubhub’s argument that Mr. Lawson was an independent contractor because he was able to work for other app-based delivery companies while also driving for Grubhub. As such, Mr. Lawson was entitled to pay for time spent making deliveries and waiting for delivery requests.
Unfortunately, in 2020 California passed Prop 22, which explicitly classifies drivers for “app-based transportation and delivery companies”—i.e., Grubhub drivers and the like—as independent contractors. Nevertheless, Prop 22 is not retroactive, so Mr. Lawson was able to recover for time he spent driving in 2015. More importantly, Prop 22 does not apply to companies other than the delivery and transportation apps or outside of California, so other California workers and app-based drivers in other states may successfully challenge their status as independent contractors.
If you believe that you have been improperly classified as an independent contractor by your employer, do not hesitate to reach out to MSE by submitting our online form.
