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Is an Uber driver an employee or independent contractor?
Are Uber and Lyft drivers employees or independent contractors?
The flood of Uber and Lyft drivers has raised another question under the Workers’ Compensation Act: are Uber and Lyft drivers employees or independent contractors?
Of course, Uber and Lyft and their workers’ compensation insurance carriers argue they are independent contractors. Injured workers argue they are employees, therefore, entitled to workers’ compensation benefits. This new “side gig” work has opened up a new area of litigation under the Pennsylvania Workers’ Compensation Act, with differing results.
In response, on January 14, 2020, members of the Pennsylvania House of Representatives proposed House Bill No. 2215, the “Application-Based Company Workers’ Misclassification Act”. Pursuant to this proposed legislation, workers of such companies, i.e. Uber and Lyft, are presumed to be employees, not independent contractors. The application based company, in order to rebut the presumption, must establish all of the following:
(1) The person is free from the control and direction of the application-based company in terms of the performance of the work, both in fact and in the contract;
(2) The person performs work that is outside the usual course of the application-based company’s business; and
(3) The person is customarily engaged in an independent established trade, occupation or business of the same nature as that involved in the work performed.
House Bill 2215 would impose criminal penalties for the misclassification of application-based workers. An intentional violation would be a misdemeanor while a non-intentional violation would be a summary offense.
Whether House Bill 2215 will become law is now in the hands of the full House of Representatives. We will monitor the status of House Bill 2215 as it progresses through the legislative channels. If you have any questions as to how House Bill 2215 could impact your company, contact one of the experienced workers’ compensation attorneys at Bingaman Hess.
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