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NLRB's Associate General Counsel: Rideshare Drivers Are Independent Contractors


In an advice memo that could shake up the ongoing independent contractor v. employee classification dispute over rideshare drivers, the National Labor Relations Board ("NLRB") Associate General Counsel Jayme L. Sophir, stated that rideshare drivers are independent contractors rather than employees.

The memo, dated April 16, 2019 but not released until yesterday, addresses several cases submitted to the NLRB for advice as to whether rideshare drivers are employees of the company they work for or instead are independent contractors.  The advice memo noted that when applying the factors set forth from the SuperShuttle DFW decision, the great weight of evidence established that rideshare drivers were independent contractors.  Notably, rideshare drivers set their own hours, own their own cars, and are free to work for another competitor if they choose.  Consequently, when applying a common law agency test, the Associate General Counsel concluded that these rideshare drivers should be classified as independent contractors.

In reaching this conclusion, it follows that drivers at Uber, Lyft, and other rideshare companies are excluded from federal workplace organizing activities (such as joining or forming a union) and therefore are not protected by the National Labor Relations Act.  As a result, these rideshare drivers would also be without the ability to file unfair labor practice charges with the NLRB.

So what does this mean for rideshare drivers?  In short, it is not good news.  This advice memo deals another blow to rideshare drivers that have long fought to be recognized as employees (and also be given the ability to unionize.)   Readers will recall that the Department of Labor had recently issued an opinion letter which held that gig workers at an unidentified company were independent contractors rather than employees.  Some have speculated that if rideshare drivers were recognized as employees, companies such as Uber & Lyft would see labor costs rise 20 to 30 percent.  With both companies recently going public (and having somewhat disappointing IPO's), an advice memo that went the opposite direction (holding that rideshare drivers should be classified as employees) could have sent both Uber & Lyft stocks spiraling lower.  For the time being, this advice memo is good new for both companies.


For a copy of the advice memo:  http://src.bna.com/Ibt


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