Because of COVID-19 there has be an uptick in the gig economy. Due to layoffs and reduced hours many people find themselves looking for additional work with employers such as UberEats, Lyft, Doordash and Instacart. The gig economy provides temporary and flexible jobs in which companies tend to hire independent contractors instead of full-time employees. As businesses plan for restoring operations, some may find it tempting to look to temporary staffing agencies, independent contractors, or other non-employee models for flexibility to hedge against uncertain demand and a potential second wave of the virus. Doing so may lead to a worker misclassification lawsuit.
Monday through Friday, Noah is a full-time dental assistant. Recently, she began moonlighting as a part-time delivery runner for Quick Order, a food delivery service in Massachusetts. When she was hired, Noah attended a training seminar at a local Quick Order office. At the seminar she learned how to handle a delivery from start to finish, how she would receive orders, and Quick Order’s company policy on handling a distraught customer. With her new job, Noah was most excited about Quick Order’s incentive program—when a delivery runner received a 5-star rating from customers, 45 times in a row, Quick Order would provide the delivery runner a week of paid leave. After the training seminar, Noah filled out a work preference survey and received a schedule that was suitable to her lifestyle. For the past year, every Friday, Saturday, and Sunday, from 6:00 p.m. to 12:00 a.m., Noah logs into the Quick Order app on her phone and she waits for someone in the local office to send her an order.
Recently, Noah received tax forms in the mail and to her surprise Quick Order provided her with a 1099 form. Noah headed down to the local office to correct the mistake, however she was told that no mistake was made. Now what?
Determining Your Rights by Law
In the above scenario, the issue is whether Noah would have a viable lawsuit against Quick Order for employee misclassification. Under Massachusetts law, an employer who wants to treat someone as an independent contractor rather than an employee has to show that the work 1) is done without the direction and control of the employer, 2) is performed outside the usual course of the employer's business, and 3) is done by someone who has their own, independent business or trade doing that kind of work.
First, we must determine if Noah does her job without the direction and control of Quick Order. The answer appears to be "NO" as Noah clearly looks to Quick Order for direction. Remember, we were told that she attended a training seminar where she learned the company’s policies and procedures. Noah has zero discretion on how she receives an order and she definitely cannot handle a distraught customer in any manner that feels is appropriate. Because she received training, Noah is not free from control and direction in connection with the performance of making deliveries. Moreover, according to Quick Order’s incentive program, the company will provide paid time off once a goal is met; employees receive benefits such as pensions or paid leave whereas independent contractors have written contracts to establish pay, duties, length of service and are not eligible for benefits such as pensions or vacation pay. Next, we have to determine if Noah is performing her delivery runner service outside the usual course of the Quick Order’s business. Again, the answer is negative. Noah performs her duties within the usual course of Quick Order’s business because her job is an essential part of the company’s business—delivery runners are the foundation of Quick Order. Lastly, we have to figure out if Noah has her own independent business or trade in the food delivery industry. For a third time, the answer is negative. If you recall, Noah has a full-time job. She works a normal 9 to 5 as a dental assistant, which is her primary source of income but works for Quick Order on the weekends at night for extra money.
Based on the above, Quick Order, wrongfully misidentified Noah as an independent contractor and therefore she has a viable wage lawsuit claim against them under the Massachusetts Wage Act. In Massachusetts, most people who work or provide services are considered employees under the law. This means that they have rights to minimum wage, overtime, and other protections.
If you are (or WERE) an independent contractor and think that you may have been misclassified, you should contact us using the contact box below or the phone (508.998.0800) to discuss your situation today. Remember that wage violations can only go back 3 years from the date of the Complaint is filed in Court so there is a time constraint.
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