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New Florida Labor Law Impacts Uber & Lyft Drivers

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A new Florida labor law that regulates ride-sharing companies came into effect on July 1. Passed as House Bill 221, the new law governs Transportation Network Companies (TNCs), such as Uber or Lyft, including specific rules for the classification of independent contractors.

The bill created Florida Statute 627.748, establishing a framework for the regulation of TNCs. In Section 9 of this statute, there is a four-part test for determining whether a TNC driver is an employee or independent contractor. If all of the conditions from Section 9 are met (see below), then a TNC driver is considered an independent contractor.

  • The TNC does not control work hours for schedules of the TNC driver.
  • The TNC does not prevent the TNC driver from driving for other TNCs.
  • The TNC does not prohibit the TNC driver from working for other companies in other industries.
  • The TNC and the TNC driver execute a signed agreement certifying that the TNC driver is an independent contractor.

The test above has important ramifications concerning employment law. Drivers classified as independent contractors will lose access to state benefits reserved for employees, including but not limited to unemployment and workers’ compensation.

It is important to note that federal law also applies here, in the form of the Fair Labor Standards Act (FLSA).  The FLSA “provides minimum wage and overtime pay protections to nearly all workers in the U.S.,” according to a fact sheet from the United States Department of Labor. The FLSA lays out a number of guidelines for determining whether a worker is an employee.

Further complicating matters, it is possible for federal law to conflict with state law. In Florida, there is a defined system for the classification of independent contractors. But even if a worker is classified as an independent contractor in Florida, the FLSA might classify that worker as an employee. As a result, the worker would not receive Florida state benefits, but they could qualify for federal benefits.

Overall, House Bill 221 establishes a clear framework for the regulation of ride-sharing companies in Florida. So long as Uber, Lyft and similar companies meet the four-part test in Section 9 of Florida Statute 627.748, then drivers are considered independent contractors. But drivers can leverage federal law under the FLSA to seek protection and benefits.

Are you in need of legal counsel?

For both employees and employers, the field of employment law can be a difficult challenge to navigate. With an overlapping system of federal, state and local laws, it can be hard to isolate the best course of action. Thankfully an experienced employment attorney can help out, providing effective counsel and preparing you for the road ahead.

Headquartered in Miami, Florida, Penichet Law is knowledgeable in the field of labor and employment law. If you require legal assistance concerning labor or employment laws, please do not hesitate. Contact us as soon as possible.

Resources:

flsenate.gov/Session/Bill/2017/0221

leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0600-0699/0627/Sections/0627.748.html

dol.gov/whd/workers/Misclassification/misclassification-facts.pdf