First Circuit Decides Important Case About Lyft Drivers
Rideshare services like Lyft and Uber have changed the world. Users can request a ride from pretty much anywhere on their app, making it a convenient option for nights out, trips to the airport, and even everyday use. These new apps have made taxis nearly obsolete. However, in the past couple of years, concerns have arisen regarding the compensation structure of these apps. The apps make it very easy to become a driver, raising safety concerns. Further, rideshare drivers were some of the essential works most at risk during the pandemic and did not receive hazard pay. The First Circuit decided his week a case that decides whether Lyft drivers are workers engaged in interstate commerce in the case of Cunningham v. Lyft.
What happened in the Cunningham case?
In this case, a group of Lyft drivers sued claiming that Lyft misclassified their employment class. They argued that Lyft classified them as independent contractors when they are meant to be classified as employees.
In order to work for Lyft, an individual must register, download the app, and agree to Lyft’s terms of service. The terms of services lay out the basics of the service.
Lyft considers its drivers independent contractors and does not provide them with sick leave benefits. Although drivers may drive as little or as much as they want, and may also reject ride requests. Lyft also retains the right to deactivate drivers who violate the Terms of Service or fall below Lyft’s star rating or cancellation threshold.
In 2018, Lyft updated its Terms of Service. Drivers could not continue using Lyft to pick up riders until they signaled their acceptance of the updated Terms of Service by clicking the I accept button. The revised terms stated that any claims are subject to arbitration.
A group of Massachusetts-based Lyft drivers brought this lawsuit after a prior lawsuit failed. The original suit accused the company of avoiding paying wages, reimbursing business expenses, and providing benefits such as paid leave. The plaintiffs also claimed that Lyft failed to give them sick leave and that this is especially dangerous given the pandemic. However, this lawsuit did not move forward because of the arbitration clause that the plaintiffs agreed to by clicking “I accept” in the Lyft app. In order to overcome this hurdle, the Plaintiffs now claim that they are transportation workers under the definition of the Federal Arbitration Act, rather than independent contractors.
The Federal Arbitration Act includes an exemption for transportation workers engaged in interstate commerce. The plaintiffs, in this case, argued that they are engaged in interstate commerce and thus fall under this exemption from arbitration.
Plaintiffs assert that Lyft and Uber make up 40% of all traffic at Boston Logan Airport, and 63% of Massachusetts Lyft riders have used Lyft to get to the airport. Plaintiffs also argued that they cross state lines on occasion.
The Massachusetts Supreme Judicial Court decided on November 5th that the plaintiffs do not qualify as transportation workers under the FAA. The court was not convinced that occasionally driving across state lines qualified as participating in interstate commerce. Further, the court reasoned that crossing state lines is not a central aspect of the drivers’ work. Dropping off passengers at the airport is not a completed interstate trip.
This is a blow to the rights of rideshare workers. Lyft and Uber were originally meant to be “side hustles” and not full-time jobs. But after the app exploded in popularity, many people saw it as an opportunity to set their own schedules and work full time whenever they liked. However, it appears that rideshare drivers will not be receiving full-time benefits anytime in the near future. To learn more about accident with Lyft and Uber drivers visit our website.
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