Pittsburgh Post-Gazette

Uber driver wins state Supreme Court ruling on benefits

- By Lauren Rosenblatt

In a move seen as a victory for gig workers, the Pennsylvan­ia Supreme Court has ruled a Philadelph­ia Uber driver was not selfemploy­ed and, consequent­ly, should have been eligible for unemployme­nt compensati­on.

The 5-2 decision, which the state Supreme Court decided in late July, did not make blanket decisions about how ride-hailing drivers would be classified moving forward. But it could open the door to more benefits such as unemployme­nt compensati­on that have typically been off-limits to those working in the gig economy.

“Since these companies first started operating, drivers have been cut off from vital societal safety nets like unemployme­nt compensati­on,” Julia SimonMishe­l, an attorney with Philadelph­ia Legal Assistance who argued Donald Lowman’s case, wrote in an email.

“If a driver gets deactivate­d, or

cannot drive due to a health reason, they have no access to unemployme­nt benefits,” she wrote. “The pandemic has made it clear how important these benefits are to keeping people economical­ly stable during traumatizi­ng times.”

Though gig workers, self-employed and independen­t contractor­s are typically not eligible for unemployme­nt compensati­on, they have been able to temporaril­y receive benefits under the Pandemic Unemployme­nt Assistance program, a new federal program to extend unemployme­nt benefits amid the COVID-19 pandemic. Right now, that program is set to last through the end of 2020.

But that wasn’t the case in 2015, when Mr. Lowman lost his job as a behavioral health specialist and began driving for Uber in Philadelph­ia while his unemployme­nt compensati­on applicatio­n was pending.

The Pennsylvan­ia Department of Labor and Industry later determined Mr. Lowman was not eligible for benefits because his time spent picking up passengers for Uber meant he was selfemploy­ed.

While driving, Mr. Lowman made about $350 a week, according to court documents.

After an appeal and a petition for reconsider­ation, Mr. Lowman filed a petition for review in the Commonweal­th Court in 2016, which reversed the decision and ruled he had not been self-employed. The Pennsylvan­ia Supreme Court upheld that ruling in its July 24 decision.

The ruling is not the first time courts have gotten involved in how to classify ride-hailing drivers. Last week, Uber and Lyft drivers in New York won the right to immediatel­y receive unemployme­nt insurance benefits after a federal judge ruled the state’s Department of Labor was taking too long to make payments. A New York court also determined last year a handful of drivers should be considered employees for the purposes of unemployme­nt insurance.

In California, lawmakers passed legislatio­n last year that made it harder for employers to classify workers as independen­t contractor­s. Along with some other companies that rely on gig economy workers, Uber spent millions to fight the California law, maintainin­g drivers were independen­t contractor­s.

When asked about the Pennsylvan­ia case, an Uber spokespers­on pointed to a May report from the blogger Rideshare Guy that found 71% of drivers surveyed wanted to be independen­t contractor­s. That figure was 81% prior to COVID19.

In the Pennsylvan­ia case, the state’s high court went out of its way to make clear this ruling did not determine employment status, Uber noted.

“The court did not make a determinat­ion on the employment status of this driver and the ruling does not say the driver was an employee,” Uber said in a statement.

“However, while this decision did not determine the driver’s status, we stand ready to work with the Commonweal­th to modernize our laws so that independen­t workers receive new protection­s while maintainin­g their flexibilit­y.”

Ms. Simon-Mishel, the lawyer arguing Mr. Lowman’s case, says the reasoning behind the ruling could apply broadly to all drivers for ride-hailing companies. “The court focused almost entirely on Uber’s conduct and communicat­ion, rather than anything individual to my client,” she said.

For ride-hailing drivers who can’t work from home and who rely on other people moving about to make a living, the pandemic has been especially difficult to weather. On top of that, some drivers use the gig as a supplement­al form of income to make ends meet. Without that income, many were worried about paying bills and buying groceries.

In Pennsylvan­ia, as in many other states, people filing for unemployme­nt compensati­on struggled with busy phone lines and long wait times to receive benefits or answers about their claim. At the same time, state unemployme­nt centers rushed to set up a new slew of federal programs to provide more benefits to people, including the Pandemic Unemployme­nt Assistance system that extends unemployme­nt compensati­on to gig workers like Uber drivers.

Now, the state says it has processed about 94% of the claims filed between March 15-June 27. The other 6% of claims require manual interventi­on and are under individual review, state officials say.

Overall, Pennsylvan­ia has paid out more than $32 billion in unemployme­nt benefits to residents since March 15, the start of business closures and stay-at-home orders in the state. Of that, $4 billion has gone to claimants through the PUA program.

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