Jobless Claims by Uber and Lyft Drivers Revive Fight Over Labor Status

While employers are not required to make contributions to fund pandemic-related claims, they will have to make contributions after the crisis. In effect, allowing the drivers to claim the federal benefit helps the companies avoid conceding that they are on the hook for funding state benefits.

An Uber spokesman said, “Congress fully funded Pandemic Unemployment Assistance for gig workers so that every state, many of which face historic deficits, could give these workers immediate financial support at no cost to their own funds.”

Uber has also pointed out that the state’s recent law doesn’t make drivers eligible for unemployment benefits on its own. It creates a test that state agencies must apply before granting benefits, and which they have yet to do in many drivers’ cases. Most experts believe that drivers will be deemed employees under the test.

Lyft declined to comment for this article.

California’s action appears to reflect a shift by state officials. Early this month, the state seemed to be trying to process benefits for Uber and Lyft drivers under the traditional unemployment system. On a website listing frequently asked questions by workers applying for benefits during the pandemic, it instructed gig workers to “list your gig employer as your last employer.” Workers who have employers would typically be eligible for traditional unemployment benefits and therefore ineligible for federal pandemic assistance for the self-employed.

Last week, Uber, Lyft and another gig company, DoorDash, sent an email to government officials asking the state agency overseeing unemployment insurance to remove that sentence from its website and to help gig workers apply for Pandemic Unemployment Assistance.

“Many self-employed ride-share and delivery drivers intend to apply for loans and other federal relief available to independent contractors,” the companies wrote, and they “worry that making an inaccurate representation that they are employees” could preclude that, the email said.

Ms. Su, the state labor secretary, said the purpose of the new approach was to ensure that struggling gig workers could begin to receive benefits rapidly. While some Uber and Lyft drivers had successfully claimed regular unemployment benefits in California before the executive order, the process took months because the companies refused to submit income data needed to verify eligibility.

Article source: https://www.nytimes.com/2020/04/17/business/economy/coronavirus-uber-lyft-unemployment.html