The GigReporter

For the second time a jury has been unable to reach a unanimous decision on whether Uber Black drivers qualify as employees under federal and state labor laws in a federal case from Pennsylvania. Independent contractor classification tests have become too complicated for practical application in many modern settings, and should no longer be relied upon to determine qualifications for benefits.

Razak, et al., v. Uber Technologies, Inc. and Gegen LLC, No. 2:16-cv-00573, is a class action in the United States District Court for the Eastern District of Pennsylvania. The plaintiffs, drivers for Uber Black, the luxury brand of the app-based rideshare company Uber, allege that they were misclassified as independent contractors, and brought causes of action under the Fair Labor Standards Act (“FLSA”) and Pennsylvania labor laws for failure to pay minimum wages, overtime wages, and wages free and clear of expenses. Twice the question of the drivers’ employee status has gone to a jury, and twice a jury has been unable to provide a unanimous answer.

The second trial, which concluded in June, used a unique supplemental verdict sheet asking the jurors to make separate determinations about each factor of the economic realities test used for determining employee status under the FLSA, but the jury was unable to reach unanimity on many of those issues. Both sides have filed competing post-trial motions for judgment as a matter of law in their favor, and the presiding judge has indicated he does not favor attempting a third trial.

Even the plaintiffs’ attorney remarked in a statement to Law360 that the economic realities test is unworkable. No independent contractor test has ever exactly been easy to apply, but technological changes and the rise of the gig economy have made them increasingly difficult fit for many modern work situations. However much sense it made to tie worker benefits to employee/independent contractor distinctions in the early twentieth century, this case proves it certainly doesn’t make sense now. Worker benefits should be made portable, not tied to an employer or employee status, so they can be more easily administered and more fairly distributed, while removing compliance and recordkeeping burdens from businesses.