The New York State Court of Appeals ruled last week that couriers for human cloud delivery firm Postmates are employees for the purposes of unemployment benefits. The ruling was hailed by New York Attorney General Letitia James as a “huge victory for thousands of gig workers across New York.”
However, attorney Richard Reibstein, a partner with Locke Lord LLP, warns in a JDSupra blog post [1] that the ruling “may send shockwaves through the gig economy in New York and elsewhere for those who read more into the decision than is warranted.”
The case started when former Postmates courier Luis Vega filed for unemployment insurance after he was terminated. New York’s Unemployment Insurance Appeal Board determined Vega was an employee. Postmates had appealed the decision.
When reviewing decisions by the Unemployment Appeals Board, the NY appellate courts view their role as to determine whether there was enough evidence in the record to support the decision, not to form their own decision based on the evidence, Reibstein notes. “As a result, appellate courts in unemployment cases typically focus on the factors that might have supported the Appeal Board’s decision — and that is what the Court of Appeals did here in its decision.”
While James hailed the decision as a victory for all ICs in the state, Reibstein asserts the ruling has “no application to any other gig workers in the state. It is not determinative of the status of independent contractors engaged by other companies.”
Read the full blog post here [1].