Employee or Independent Contractor?

In the sharing economy, are workers employees or independent contractors?

From The Boston Globe –“The worker of the future will be fast, flexible, and available the instant a customer clicks a button on a smartphone screen.

But the worker of the future will not be an employee — at least if some of today’s fastest-growing and best-funded startups have their way. They’re positioning themselves as “technology platforms” that simply connect people with independent chauffeurs, house cleaners, or errand-runners. For the most part, the armies of workers that companies like Uber or TaskRabbit are assembling — often after screening interviews, background checks, and training programs — are treated as independent contractors and receive no benefits.

A class-action lawsuit filed this summer in Massachusetts and California courts is challenging that. The suit asserts that Uber improperly classifies its drivers, who own their cars and use Uber’s smartphone app to get work, as independent contractors. No sick time, no health insurance, no 401(k) contributions.

And the case is creating anxiety for other startups providing on-demand services, typically using websites or mobile apps.

Rightfully so, says Russell Beck, an attorney with Beck Reed Riden LLP in Boston. Massachusetts puts the burden on employers to rebut “a strong presumption that the individual is an employee,” Beck explains. The central legal question: whether the individual is performing a task “outside of the usual course of the employer’s business.”

A plumber who fixes a leaky faucet at Uber’s office is an independent contractor. But “anyone who is driving a car for Uber is performing precisely the service that Uber provides in the usual course of its business,” Beck says, and thus is probably considered an employee in the state….”

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