Gig-economy employers watch nervously as case heads to appeal
A federal judge has ruled that a Grubhub Inc. delivery driver should be considered an employee, rather than an independent contractor, for minimum wage and overtime claims. The ruling by Judge Jacqueline Scott Corley of the US District Court for the Northern District of California is the latest development in a closely watched case involving the food delivery app-based platform.
Grubhub has maintained that it is a marketing company that provides an online platform to connect restaurants to customers and facilitate online food ordering, with food delivery being only a minor part of its business. The industry has argued that its financial future relies on treating workers as independent contractors rather than employees, who are eligible for overtime, workers’ compensation, and other benefits.
However, Judge Scott Corley rejected Grubhub’s arguments and ruled that the driver, Raef Lawson, should be considered an employee under California’s three-part test to determine employment status. Last September, the judge had ruled that the ABC test did not apply to Lawson’s claim for business expense reimbursement.
According to the ruling, Lawson is entitled to judgment on his minimum wage claim, with damages of $65.11. However, Grubhub is entitled to judgment on Lawson’s overtime claim.
The judge ruled that Raef Lawson, should be compensated for the time he spent making deliveries, as well as the time he was available for...
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