Lawsuit Seeks to Designate Uber, Lyft Drivers as Employees

BOSTON — Massachusetts Attorney General Maura Healey is asking for a court ruling recognizing Uber and Lyft drivers as employees under the state’s wage and hour laws.

The lawsuit, filed in Suffolk Superior Court, challenges the designation of drivers as independent contractors by the ride hailing companies.

The new designation would give drivers access to what Healey described as critical labor rights and benefits — including minimum wage, overtime, and earned sick time.

“Uber and Lyft have built their billion-dollar businesses while denying their drivers basic employee protections and benefits for years,” Healey, a Democrat, said in a written statement Tuesday. “This business model is unfair and exploitative. We are seeking this determination from the court because these drivers have a right to be treated fairly.”

Representatives from the companies said drivers appreciate the flexibility, and designating them as employees could threaten jobs at a time of high unemployment due to the pandemic.

Healey said that in Massachusetts, a worker who provides any service for another party is presumed to be an employee unless that party can prove: the worker is free from their direction and control; the services the worker performs are outside the usual course of their business; and the worker is customarily engaged in an independently established trade, occupation or business of the same nature as the service performed for the party.

Uber and Lyft both fail to meet the three-part test that would allow them to classify drivers as independent contractors, Healey said.

Healey said many drivers aren’t even guaranteed the state minimum wage or overtime because the companies don’t pay them for time spent between rides or reimburse them for necessary business expenses such as fuel, vehicle maintenance, and insurance.

The lawsuit argues that the drivers provide a service that is essential to the companies’ core business, and without their drivers, these companies would cease to exist.

The companies disagree with Healey.

Uber spokeswoman Alix Anfang said given the current unemployment rate in Massachusetts, state leaders should be making it easier, not harder for people to earn a living.

“We will contest this action in court, as it flies in the face of what the vast majority of drivers want: to work independently,” Anfang said in a written statement. “We stand ready to work with the state to modernize our laws, so that independent workers receive new protections while maintaining the flexibility they prefer.”

Uber representative C.J. Macklin said a change in designation would threaten to eliminate work for more than 50,000 people in Massachusetts at the worst possible time.

Macklin said in a written statement that the vast majority of Lyft drivers drive fewer than 20 hours a week and “choose to drive rideshare precisely because of the independence it gives them to make money in their spare time.”

Healey’s lawsuit argues that the companies closely monitor the activities of drivers through their apps and can penalize drivers for not accepting enough rides, cancelling too many rides, failing to maintain customer satisfaction ratings, or engaging in any conduct the companies determine to be grounds for suspension or termination.

Uber and Lyft also unilaterally determine their drivers’ pay structure, which is calculated using complicated formulas that change frequently, the lawsuit argues.