Despite Lack of Workers’ Comp, N.Y. Court Finds Triable Issues on Uber Driver’s ‘Employee’ Status

Case File

Uber drivers don't get workers' compensation benefits, but does that mean they aren't "employees" under New York tort law? An Empire State court found that question, along with other considerations, merited jury review.

Case

Rawlins v. Myint, No. 511200/2020 (N.Y. Sup. Ct. 07/13/26)

What Happened?

A passenger was riding in a car when it was struck by a vehicle owned and operated by a driver who was logged into Uber's rideshare platform. The passenger brought a tort action against Uber, alleging that the company was vicariously liable for the driver's negligence under the doctrine of respondeat superior.

Uber denied that an employment relationship existed between it and the driver and moved for a directed verdict. In particular, Uber argued that the driver exercised complete discretion over "who, what, when, where, why and how" he operated his vehicle, that Uber did not control how he drove or completed rides, that either party could terminate the Technology Services Agreement at any time, that Uber merely acted as a payment intermediary, and that the evidence established the driver's independent contractor status. Further, Uber maintained that the undisputed evidence showed that the driver owned his own vehicle, was issued a Form 1099 rather than a W-2, was free to determine when and where he worked, and was not supervised by Uber.

In opposition, the passenger argued that the evidence established that an employment relationship existed. The passenger argued that the Technology Services Agreement was drafted exclusively by Uber and presented on a take-it-or-leave-it basis and that Uber retained the unilateral authority to terminate drivers based upon customer ratings, established the fares charged to riders, collected payments directly from riders before remitting a portion to drivers, and controlled the types of vehicles that could be used on its platform. 

Rule of Law

The critical inquiry in determining whether an individual is an employee or an independent contractor is the degree of control exercised by the purported employer over the results produced or the means used to achieve those results.

What the Court Said

In rejecting Uber's assertion that "the evidence permitted only one conclusion," the court found that the passenger presented legally sufficient evidence from which a rational jury could conclude that Uber exercised the requisite degree of control not merely over the results of the driver's work but over the means by which that work was performed, thereby supporting a finding of an employment relationship.

In the court's view, evidence established that Uber drafted the Technology Services Agreement and required drivers to accept its terms as a condition of accessing the platform. There was no evidence that drivers meaningfully negotiated the agreement. Moreover, Uber retained the contractual authority to deactivate drivers based upon customer ratings, thereby reserving the right to terminate a driver's access to the platform. 

"A jury could reasonably view that authority not merely as a termination provision, but as evidence of control over the manner in which drivers performed rides, because the rating system evaluated how the driver drove and interacted with riders," the court wrote.

While the court acknowledged that there was evidence supporting independent contractor status, such as evidence showing the driver owned his own vehicle, determined when and where he worked, could simultaneously drive for competing rideshare companies, received a Form 1099 rather than a W-2, was not provided workers' compensation benefits, had no supervisor, and was free to take time off without seeking permission, this evidence did not eliminate the competing evidence of control.

The court treated the absence of workers' compensation benefits as evidence supporting independent-contractor status, but ultimately concluded that evidence of Uber's control created a factual dispute that only a jury could resolve.

Verdict: The court denied Uber's motion for a directed verdict.

Takeaway

While the absence of workers' compensation coverage may support independent-contractor status, it is only one factor in the analysis and does not preclude a jury from finding an employment relationship for respondeat superior purposes.

Share This Article: