Uber and Lyft drivers win the battle for unpaid unemployment benefits

It is the latest development in a long-running battle for labor rights among so-called workers seeking to classify themselves as employees to secure benefits like employer-funded health care and sick leave. Many tech companies, including Uber and Lyft, argue that their workers are independent contractors.

Court records show that New York drivers MD Islam, Doh Oattara, Abdul Rumon and Harnek Singh applied for unemployment in March to avoid contracting coronavirus on the job when the city emerged as an early epicenter of the Covid-19 pandemic in the United States.

Judge LaShann DeArcy Hall issued a preliminary injunction in favor of the drivers Tuesday morning. Their decision requires the State Department of Labor to send drivers the full unemployment payments to which they are entitled while their case is processed in court.

The New York Taxi Workers Alliance, a labor rights group, filed a lawsuit on behalf of drivers in May after the state failed to send drivers the full amount of unemployment payment to which employees are entitled. state.

NYTWA told CNN Business that Uber and Lyft lobbyists previously persuaded the state Department of Labor to order their ride-sharing drivers to apply for federal designated unemployment benefits for independent contractors instead of designated employee benefits.

Drivers say they have been forced to wait much longer to receive reduced unemployment checks under the federal unemployment program, which uses a workers’ net profit to decide their rate of benefits rather than the gross rate that employees receive. As a result, most Uber and Lyft drivers have been forced to wait 10 weeks to receive the minimum weekly unemployment rate of $ 180 for independent contractors instead of just three weeks for the maximum rate of $ 504 per week for employees, according to NYTWA.

In her ruling, Judge Hall said the denial or delay of unemployment benefits from the state Department of Labor is “sufficient to establish irreparable harm to Plaintiffs.”

The Taxi Workers Alliance celebrated the ruling Tuesday afternoon. “We are delighted,” NYTWA CEO Bhairavi Desai told CNN Business. “There is no doubt that justice has been long overdue, but we are delighted that it has finally come.”

A spokesman for the state Labor Department said it is “reviewing the decision and considering all of our options.”

“Still, the Labor Department has been providing benefits to ride-sharing drivers in New York and is committed to continuing that support,” the spokesperson said.

Uber and Lyft are two of the concert companies that spent $ 110 million combined to promote a California voting initiative known as Prop. 22, which will be on California voters’ ballots in November. The measure would reclassify concert enforcement workers as independent contractors again after state lawmakers passed a law last year requiring concert companies to recognize their workers as employees.

Uber told CNN Business that its drivers prefer to be classified as independent contractors because it allows them to work when they want to rather than having a schedule set by their employer. The company also said that independent drivers can earn more money without the wage limits set by unions and labor laws.