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Leadership

Food delivery services are the latest on-demand companies sued for worker status

Claire Zillman
By
Claire Zillman
Claire Zillman
Editor, Leadership
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Claire Zillman
By
Claire Zillman
Claire Zillman
Editor, Leadership
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September 24, 2015, 3:29 PM ET
GrubHub IPO
The GrubHub Inc. app is displayed on an Apple Inc. iPhone 5 in Tiskilwa, Illinois, U.S., on Wednesday, April 2, 2014. GrubHub Inc., the Internet platform that enables users to order pick-up and delivery from restaurants, raised the expected price range for its initial public offering to $23 to $25 per share from $20 to $22 in a regulatory filing on Tuesday. The company plans to list on the New York Stock Exchange under the ticker symbol GRUB. Photographer: Daniel Acker/Bloomberg via Getty ImagesPhotograph by Daniel Acker — Bloomberg via Getty Images
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The lawyer who’s already sued ride sharing platforms Uber and Lyft has a new target: food delivery services.

On Wednesday in San Francisco superior court, Boston attorney Shannon Liss-Riordan filed lawsuits against GrubHub, DoorDash, and Caviar claiming that the food delivery companies have misclassified their drivers as independent contractors. Liss-Riodan has filed lawsuits on those same grounds against Uber and Lyft, with some success. Last month, a federal judge certified a class of drivers in the case involving Uber.

The lawsuits against GrubHub and DoorDash are class actions; the one against Caviar is a demand for arbitration. The filings argue that the services’ drivers are being treated as employees but because they’re considered independent contractors, they get none of the benefits.

The complaint targeting GrubHub, for instance, says the plaintiffs operate as employees yet they don’t receive overtime pay or reimbursement for expenses because of their classification as independent contractors.

A spokesperson for GrubHub told Fortune that it could not comment on pending litigation. DoorDash and Caviar did not immediately return requests for comment.

The classification issue is a hot one in the field of labor law, especially when it comes to on-demand apps whose business models rely on inexpensive labor. As plaintiffs’ lawyers challenge the legality of companies’ independent contractor workforces, some players in this space, such a grocery delivery company Instacart and shipping service Shyp, have voluntarily transitioned their “1099” workers—a reference to the tax designation for independent contractors—to W-2 employees.

About the Author
Claire Zillman
By Claire ZillmanEditor, Leadership
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Claire Zillman is a senior editor at Fortune, overseeing leadership stories. 

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