New York Governor Paterson Signs Bill To Deliver Workers’ Benefits To New York Livery Cab Drivers, Protect Crucial City Industry

New Bill Will Clearly Designate Drivers and Create Fund to Provide Benefits for Independent Contractors

Albany, NY  (CompNewsNetwork) - New York Governor David A. Paterson Has signed into law a bill which establishes clear rules to determine when livery cab drivers in New York City, Westchester, and Nassau County are considered employees or independent contractors of livery bases--cab companies that dispatch livery drivers across the City. The new law also calls for the creation of a fund to give independent contractor livery drivers and their families workers' compensation benefits in cases of severe injury or death.

Lack of a clear designation for livery drivers has jeopardized compensation for injured workers, led to extensive and costly litigation, and even affected compensation for other non-driver employees of livery cab companies.

“The livery cab industry is a key element of New York City's public transportation network, as well as a job-producing machine for tens of thousands of New Yorkers,” said Governor Paterson. “Today's bill will reform a system that has been bogged down by bureaucracy for too long by clearly designating whether a driver is independent or not, thereby delivering much-needed workers' benefits while protecting bases across the City and surrounding area.”

Congressman Charles Rangel said: “This law is long overdue. These livery cab drivers -- most of whom are immigrants who in the tradition of so many others work non-stop to give their families a shot at the American Dream -- deserve some sense of security as they ride the streets night and day. It's the kind of law that makes a big difference in the lives of everyday New Yorkers and a testament to the leadership of men like Governor David Paterson and Assembly members who co-sponsored the measure like Adriano Espaillat and Keith Wright.”

Senate Majority Leader Dean G. Skelos said: “This new law will provide important reforms, protection and security for livery cab drivers and cab bases. These men and women provide a necessary transportation service and should receive the appropriate compensation when they are injured on the job. I commend Governor Paterson for signing this bill into law.”

Assembly Speaker Sheldon Silver said: “Livery drivers are an essential transportation option throughout the five boroughs. The legislation signed by Governor Paterson today puts in place a clear set of guidelines that adequately differentiate between a company driver and an independent contractor. This legislation will provide hardworking livery cab drivers with workers' compensation benefits in the case of a serious work-related accident and protect livery services in the metro area.”

Senator Serphin R. Maltese said: “I am very pleased that Governor Paterson has signed this measure into law. It will clear up perennial problems that have plagued livery drivers for years and establish a fund to provide workers' compensation benefits to independent livery drivers when no-fault automobile insurance does not provide any or sufficient coverage. This protects both drivers and livery cab bases.”

Assemblyman Adriano Espaillat said: “This historic legislation will finally bring relief and much needed benefits to over 40,000 livery drivers and their families. Governor Paterson's leadership has stamped his administration with a human face, that of thousands of families of livery drivers.”

Fernando Mateo, Founder and Spokesman for the New York State Association of Taxi Drivers, said: “Workers' compensation will benefit every driver that risks his life everyday to serve his community. Unfortunately, for years these drivers had no coverage whatsoever, and many have suffered hardships due to injury, assaults, robberies and even murder on the job. We commend and applaud this initiative that we have so long awaited.”

To protect both the drivers and businesses in one of New York City's most crucial transportation industries, today's legislation (S. 8715 /A. 11759) is significant for two reasons. First, it will establish a clear set of rules to define when drivers are either employees or independent contractors of livery cab bases. Such a designation will be made up front for each livery cab base, so that policies can immediately be put in place for drivers and workers there to claim benefits and compensation.

Second, the bill will create a new fund that, for the independent contractors, establishes full workers' compensation coverage for many serious injuries—death, paralysis, loss of limb and those resulting from a crime. In these cases, drivers will no longer be forced to rely on the no-fault insurance system. The fund will provide greater benefits to the drivers than if they were completely independent contractors, while the bases would pay less than if they were full employees.

Currently, there is no system in place to clarify when livery cab bases should classify their drivers as employees or independent contractors. As a result, an injured driver could go years without receiving compensation because this lack of designation bounces drivers between the no-fault insurance and workers' compensation systems.

Furthermore, the livery cab bases can be hit with substantial judgments and even felony charges for not adequately providing benefits to their workers. On top of this, other non-driver employees of livery cab companies also see their benefits threatened because insurers often require livery bases to purchase workers' compensation insurance for their drivers -- even if they may be independent contractors -- before they will provide coverage for other workers.

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