It took eight years for a former Grubhub driver Raef Lawson to win a legal battle against his former company. Lawson claimed that he should be entitled to more benefits as an employee, to which the court agreed in its ruling.
California Case Sets a Legal Precedent on Employment Status of Gig Workers
Lawson, who is also an aspiring actor, comedian, and writer, briefly worked as a Grubhub driver for four months. In 2015, he first filed the case against Grubhub as he claimed more benefits from the company as an employee. However, there was a debate back then whether a gig economy worker like Lawson should be considered an employee or a contractor.
As reported by Gizmodo, Lawson believes that he should be entitled to minimum wage, overtime pay and other benefits, which companies must be obliged to give their employees. Unfortunately, the court did not side with him in 2018 as the ruling stated that Lawson is a contractor and not an employee.
Lawson filed an appeal to the Ninth Circuit that eventually led to another hearing of the case in the same district court that made the first ruling. This time, Judge Jacqueline Scott Corley ruled that Lawson was in fact a Grubhub employee within the 4 months that he had worked for the company.
"Mr. Lawson is properly classified as an employee, not an independent contractor, for purposes of his minimum wage and overtime claims," Judge Corley said. With this, he should be entitled to the benefits of an employee, as stated in California laws. However, the worth of damages that should be settled in Lawson's case only amounted to $65.
In spite of the small payout, Lawson's case set an important precedent for the gig economy. As per Silicon Valley, companies like Grubhub, Uber, Lyft and DoorDash might have to adjustments to the kind of relationship that they have with their workers from here on.
"Raef Lawson is the first gig worker in America to be declared an employee by a court for wage law purposes," Lawson's layer, Shannon Liss-Riordan, said. The case can be used in the future to oblige companies to reimburse vehicle utility expenses to their workers, among other benefits that are rightfully given to employees.
Related Article: Grubhub Agrees To A $3.5 Million Settlement Over Deceptive Practices, Hidden Charges
Gig Workers Setting Their Own Work Hours Can Still Be Considered Employees
According to Grubhub, Lawson was not entitled to the benefits of an employee because he set his own hours in duty as a delivery rider. Therefore, he was operating like a "free-standing" business. Judge Corley did not share the same view, stating that California's laws define an employee as someone who works for a company that is not "outside its usual course of business." As a Grubhub driver, Lawson met this criterion.
As for the amount of settlement in Lawson's case, the court ruled that Lawson did not work for more than 40 hours in a week while he was still a Grubhub driver so he was not entitled to overtime pay.
Independent contractors are awarded fewer benefits compared to business employees. For many years, gig workers have been considered contractors who are not entitled to overtime and insurance benefits.
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