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Drivers Are Assumed Employees by NLRB

In a first for the National Labor Relations Board, it filed an unfair labor practices compliant against a company by simply assuming that its drivers are employees and not independent contractors.

The complaint was brought by the Chicago-based regional office of the NLRB against a service called Postmates Inc., based in San Francisco, and operating in cities throughout the United States.

The company describes itself as an on-demand delivery service that, “connects customers with local couriers who can deliver anything from any store or restaurant in minutes.”

NLRB alleges that Postmates violated federal labor law by requiring their “employee” drivers to enter into arbitration agreements and prohibiting them from discussing terms and conditions of their supposed employment.

“In this case the NLRB simply assumed that Postmates’s couriers are employees, rather than independent contractors, without holding a hearing or allowing any briefing on the issue,” note Paul Galligan and Samuel Sverdlov, attorneys with the law firm of Seyfarth Shaw.

“This is significant because the NLRB does not have jurisdiction to file complaints on behalf of independent contractors,” they add.

The case also could have serious implications for other courier and package delivery firms that have carefully crafted their service agreements with their drivers to maintain their legal status as independent contractors.

“The NLRB’s action demonstrates its continued willingness to insert itself directly into the dispute over gig worker classification, giving little deference to a company’s classification of its workers. More such cases are likely to follow,” warns Philip Azzara of the Fisher Phillips law firm.

Galligan and Sverdlov say the NLRB will likely gloss over the employer’s characterization of independent contractor status, and file an unfair labor practice complaint whenever it believes that the workers involved are “employees.”

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