🚘 The unemployment dilemma for Uber and Lyft
Ride-sharing drivers have earned an important victory in being able to receive unemployment benefits in California, but they fear they’ll lose the bigger prize of being considered employees.
Earlier this year, California enacted Assembly Bill 5: It required companies like Uber and Lyft to offer independent contractors many of the same benefits as workers. But Uber and Lyft are challenging the law in court.
When the pandemic struck, federal unemployment rules changed: The Pandemic Unemployment Assistance program gave independent contractors the ability to file for unemployment, which they previously could not do in most states.
To file, independent contractors must state they are independent contractors: And that’s the dilemma for ride-sharing drivers in California. They think Uber and Lyft will use their self-identification as proof they are independent contractors and not employees. One California driver, who is getting $767 a week in unemployment benefits, is concerned he will lose overtime back pay he is owed.
Legal experts believe Uber and Lyft will use the self-identification on the unemployment forms in their legal challenges, but most say the drivers will prevail. And in New York, there’s arguably a greater problem for gig workers: They’re having to sue to receive their unemployment benefits.