A Gig Economy Independent Contractor Checklist — For Now

A federal judge in California recently found that a restaurant delivery driver working for Grubhub was an independent contractor rather than an employee (and thus was not entitled to minimum wage, overtime, and expense reimbursement under California law). As a first-of-its-kind decision on the merits of the independent contractor analysis in the so-called “gig” or “sharing” economy, the decision presents a fairly comprehensive analysis of the traditional independent contractor analysis in this developing context. It’s important to recognize that there may be limits to the Grubhub case’s applicability to other new-economy companies because many of the judge’s determinations were based on the plaintiff’s lack of credibility. The decision is also likely to be appealed to the Ninth Circuit, which is typically not friendly to the gig economy.

Yet, for now, the case provides a checklist that companies might use to review their arrangements with independent contractors. Factors to consider include: