NY Federal Judge Orders Unemployment Payouts For Uber, Lyft Drivers

New Yorkers may soon see a lot of smiles on the faces of Uber and Lyft drivers following a judge’s ruling on Tuesday (July 28) that rideshare drivers must receive state unemployment benefits within 45 days, per a report from The New York Times.

A group of drivers and an advocacy group called the New York Taxi Workers Alliance sued Gov. Andrew Cuomo in late May, arguing that Uber and Lyft drivers were entitled to benefits and that the state was stalling in paying them.

Ridesharing companies have long maintained that the drivers are independent contractors and therefore aren’t entitled to unemployment benefits. The matter was complicated by COVID-19 relief funding directed toward contractors.

In the ruling for the drivers, U.S. District Judge LaShann DeArcy Hall wrote: “Defendants have no cognizable interest in failing to pay benefits to (For Hire Vehicles) claimants when due. Defendants’ only argument advanced on this point is that [in] the current economic climate, it would be imprudent to dedicate resources to providing preliminary relief requested by Plaintiffs. To the contrary, it is precisely because of the current economic climate that such immediate relief is demanded.”

Battles over the status of Uber and Lyft drivers have been raging in California and Massachusetts. California state attorneys plan to ask a judge to order Uber and Lyft to classify their ride-hailing drivers as employees rather than contractors, Reuters reported.

In other unemployment news, the U.S. Department of Labor (DOL) reported on July 23 that the number of seasonally adjusted initial jobless claims reached 1,416,000 for the week ending July 18, up 109,000 from the previous week’s revised level.