California Says Uber Driver is an Employee, Not an “Independent Contractor”

Yesterday, Uber appealed a California Labor Commission ruling that held an Uber driver was not an independent contractor, but an employee of Uber.  $4,152.20 in backwages is insignificant when compared to the broad implications of reclassifying Uber drivers as employees.

The ruling is in striking contrast to Uber’s long-held proclamation as a “logistics” or a “lead generating” service that simply connects independent contractors to consumers desiring those services.

A similar ruling here in Washington State could have a major impact on Uber operations here. The Washington State Supreme Court tackled the independent contractor v. employee issue recently in Anfinson v. FEDEX Ground Package System, Inc., 281 P.3d 289 (2012) in adopting the FLSA (“Fair Labor Standards Act”) “economic reality” test[1] for deciding whether an individual is an employee or an independent contractor.[2] The test largely focuses on the degree to which an employer asserts control over the worker. Should a similar ruling to California’s be adopted here, Uber would need to dramatically revise its business model.

[1] The Court referring it to also as the “economic dependence” test.

[2] See also: Bonnette, 704 F.2d at 1469-70 (Home health care workers jointly employed by social service agencies); Real v. Driscoll Strawberry Associates, Inc., 603 F.2d 748, 755-56 (9th Cir. 1979) (licensor of patented strawberries may have jointly employed strawberry growers, where it could control important growing and marketing decisions).

Should You Be Paid Overtime for Answering Late Night Work Email?

This was the question posed by Lauren Weber of The Wall Street Journal in her article, "Can You Sue the Boss for Making You Answer Late-Night Email?"

The author cites Pew Research Center studies that report 44% of internet users regularly did some job tasks outside the workplace. While smartphone technology has greatly increased the availability of workers, it hasn’t necessarily increased their overtime. While the vast majority of white-collar workers are exempt from the Fair Labor Standards Act and Minimum Wage Act, new Department of Labor rules are expected to change this.

In Washington, what constitutes “work” is the often a major dispute in minimum wage and overtime cases. “Work” is not defined in the MWA or the FLSA, but the courts have defined work as activity or inactivity that is requested or allowed by the employer and that is pursued predominantly for the employer’s benefit, even though it confers a benefit on the employee.

See: Tennessee Coal, Iron & Railroad Co. v. Muscoda Local 123, 321 U.S. 590, 598, 64 S. Ct. 698 (1944) (defining work as “physical or mental exertion (whether burdensome or not) controlled or required by the employer and pursued necessarily and primarily for the benefit of the employer and his business”).

The Washington Administrative Code defines “work” under WAC 296-126-002(8), as “hours worked” as “all hours during which the employee is authorized or required by the employer to be on duty on the employer’s premises or at a prescribed workplace.”[1]

Several notable companies have been sued for failing to pay overtime for smartphone use after hours, namely Verizon, T-Mobile and Black and Decker. Set for trial in August 2015, a Chicago police sergeant has filed suit against the City of Chicago alleging that he was required to respond to emails and text messages while off duty, but without receiving overtime.

While there have been relatively few of these types of smartphone/after-hours cases, this may change following revision of the Department of Labor rules expected for release and public comment any day now.

[1] Applied in Stevens v. Brink’s Home Security, Inc., 162 Wn.2d 42, 48-50, 169 P.3d 473(2007), Mechanics were engaged in “work” when they drove company vans from their home to the first customer at shift’s start and drove from the last customer to home at shift’s end.

Sorry Kid, No Overtime for Movie Projectionists

Last week, the #1 article from Sunday's edition of The New York Times was an Op-Ed piece highlighting the antiquated Federal Labor Laws that exclude millions of workers from receiving potential overtime.

Movie Projectionists are excluded from overtime under RCW 49.46.130“Sorry kid,” movie projectionists are excluded from overtime under RCW 49.46.130

Under Federal law, employees holding perceived white-collar positions like supervisor, manager, even vice president may be exempt from overtime requirements, even though their gross hourly rate is less than $12 an hour. Even in Washington State, a forum recognized for its strong labor laws, there contains noted exceptions for “administrative” and “executive” positions. As a result, an hourly manager at McDonald's may not be entitled to overtime and other protections under the Washington State Minimum Wage Act “MWA”. Parallel exclusions under the Federal Labor Standards Act (“FLSA”) include country elevator workers, newspaper delivery persons, sugar processing employees, and radio station employees. Yes, even movie projectionists are exempt from the 40-hour overtime requirements. These and other provisions of the WMA are ripe to be updated to reflect the dramatic changes to today’s workforce.