New York’s Court of Appeals has reinstated a 2015 decision determining that couriers for on-demand delivery app Postmates should be classified as employees, making them eligible for unemployment insurance at a time when the US is seeing record job losses due to the coronavirus pandemic.
The 2015 decision by the state’s Unemployment Insurance Appeals Board originally found that a terminated Postmates courier, Luis Vega, should be classified as an employee and therefore eligible for unemployment benefits when he was kicked off the platform. That decision also required the company to pay into New York’s Unemployment Insurance Fund for that employee and for “all other persons similarly employed.”
The ruling could be significant for Postmates couriers, as shelter-in-place restrictions or the need to self-quarantine has led to mass layoffs and significantly reduced on-demand work. For those still able to work for on-demand delivery apps like Postmates, there is a risk of getting infected. Typically, gig workers are classified as independent contractors, which means they are ineligible for unemployment benefits or healthcare.
Postmates has tried to address this by launching a fund that couriers can take advantage of to pay back medical expenses related to COVID-19, the disease caused by the novel coronavirus. And DoorDash and Instacart now offer up to 14 days of sick pay if they’re affected by coronavirus. But workers for these companies and others are still especially vulnerable while more and more Americans are relying on their services. For that reason, Instacart shoppers are organizing a work stoppage on Monday to fight for better sick leave and company-provided protective gear such as hand sanitizer and disinfectant wipes.
In yesterday’s ruling, a majority of the judges supported the original decision’s determination that “Postmates exercised control over its couriers sufficient to render them employees rather than independent contractors operating their own businesses.” If those workers were classified as independent contractors, Postmates would not be obligated to pay into unemployment insurance for them.
“Today’s decision is a huge victory for thousands of gig workers across New York,” said New York Attorney General Letitia James in a statement. “The courts have solidified what we all have known for a while — delivery drivers are employees and are entitled to the same unemployment benefits other employees can obtain.”
“While we do not agree with the majority opinion from the New York Court of Appeals in the matter of Vega v. Postmates, the court’s conclusions support a position for which Postmates has long advocated: we need a modern worker classification framework that is relevant to the autonomy and flexibility made possible by app-enabled work,” Postmates said in a statement.
“We fully support designing a responsible framework that allows New Yorkers to choose if, when, where, and for how long they work, while also providing them access to the benefits and services they deserve. As stated in the dissenting opinion, ‘Our current framework, as inconsistently applied, fails to provide clarity to anyone involved.’ We want to work with New York to change that.”
In addition to its medical fund, Postmates has also followed other on-demand delivery apps in introducing “non-contact” meal deliveries to help encourage social distancing, which can help prevent the spread of COVID-19.