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New York Uber Drivers and Unemployment Insurance Eligibility

Published on Jan 26, 2021 at 8:48 am in News.

Department upholds the previous two findings that Uber drivers should be considered employees and be eligible for benefits like unemployment insurance.

In most of the country, rideshare drivers are considered independent contractors, meaning they lack the protections granted to regular employees under U.S. labor law, including health and unemployment insurance and workers’ compensation. That hasn’t stopped drivers from seeking benefits.

In one instance, Colin Lowry, who served as an Uber driver in upstate New York, applied for unemployment benefits after he stopped participating on the platform. The New York Department of Labor initially determined Lowry to be an employee of Uber, making the company liable for the unemployment insurance claim. Uber objected to the finding, but an administrative law judge upheld the ruling. The Unemployment Insurance Appeal Board affirmed, but Uber appealed.

Following the appeal, the New York Supreme Court found evidence to support the findings that Uber exercised enough control over its drivers to establish an employment relationship with them. The evidence included Uber controlling drivers’ access to their customers, calculating and collecting fares, and setting drivers’ compensation rates.

That is not all the Uber controls. While drivers have the freedom to choose the route they take to transport a customer, the company provides navigation, tracks the drivers’ location, and reserves the right to adjust the fare if the drivers take an inefficient route. Uber also controls the vehicle used and uses its rating system to encourage and promote certain driver conduct.

This is not the first time the state of New York has reclassified gig economy workers. In March 2020, the New York State Court of Appeals ruled that Postmates drivers are employees and eligible for benefits like unemployment insurance. The decision was born out of similar circumstances to the case discussed above. An ex-Postmates driver, Luis Vega, filed for unemployment benefits after being terminated in 2015. While Postmates won an appeal in state court in 2018, it lost in the New York State Court of Appeals.

As west coast Uber and Lyft drivers in California continue to fight for their rights and employment status, the east coast is seeing similar debates and lawsuits. App-based ride-hailing and delivery service workers all over the country are looking to be considered employees eligible for benefits.

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