Massachusetts sues Uber, Lyft over misclassification of drivers
Massachusetts AG's lawsuit is similar to one filed by California in May
Massachusetts Attorney General Maura Healey on Tuesday announced a lawsuit against ridesharing companies Uber and Lyft over alleged worker misclassification.
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"Uber and Lyft have built businesses on a model that misclassifies drivers as independent contractors instead of employees," Healey wrote in a Facebook post. "Drivers are not guaranteed to make the minimum wage, don’t get paid overtime, and can't take paid time off when they and their family members are sick. But Massachusetts law is clear—drivers are employees."
The suit "threatens to eliminate work for more than 50,000 people in Massachusetts at the worst possible time," a Lyft spokesperson told FOX Business.
A driver and passenger wearing protective masks exit the ride sharing pickup area in a car displaying Uber Technologies signage at San Francisco International Airport in San Francisco, California, U.S., on Monday, May 4, 2020. Photographer: David Pau
"Drivers don’t want this — most drive only a few hours a week, and they have chosen to drive using Lyft precisely because of the independence it gives them to make money in their spare time," the Lyft spokesperson said.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| UBER | UBER TECHNOLOGIES INC. | 69.05 | -0.26 | -0.38% |
| LYFT | LYFT INC. | 16.37 | +0.30 | +1.87% |
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“At a time when Massachusetts’ economy is in crisis with a record 16% unemployment rate, we need to make it easier, not harder, for people to quickly start earning an income," an Uber spokesperson told FOX Business in a 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.”
Healey, a Democrat, is taking a page out of California's playbook. In May, California Attorney General Xavier Becerra filed a lawsuit against Uber and Lyft for "misclassifying" drivers as independent contractors instead of employees "in direct contravention of California law." The California law in question, the controversial Assembly Bill 5, went into effect in January.