GrubHub Driver Pay Fight Moves Forward

(Bloomberg) -- A federal judge who has ruled that a former driver for GrubHub Inc. was properly treated by the company as an independent contractor said there’s a “substantial question” whether he should be considered an employee after an April ruling by California’s highest court.

U.S. Magistrate Judge Jacqueline Scott Corley was asked by the driver’s lawyer to reconsider her ruling and said at a hearing Thursday that the issue should probably be decided by a state court.

Key Insights

  • GrubHub was the first gig-economy company taken to trial over worker classification, and how the case is ultimately decided may have a broad impact on the business model of other sharing-economy startups, including Uber Technologies
  • The lawyer representing the GrubHub driver, Shannon Liss-Riordan, said the case presents the “perfect opportunity” to ask a federal appeals court to move the lawsuit to the California Supreme Court, which she said may be the fastest way to resolve the dispute
  • The stakes are high because the litigation may determine whether drivers qualify under California’s new contractor-status test to be reimbursed for their personal vehicle expenses, and whether the drivers can claim expenses retroactively

©2018 Bloomberg L.P.