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Apr 7, 2015

Proposed Alaska Legislation Would Clarify That Uber and Lyft Drivers Are Not Entitled to Comp Benefits

As I mentioned in an earlier post, juries in two civil actions pending before a federal court sitting in California will be allowed to determine if Uber and Lyft have the right to exercise sufficient control over California drivers to make them employees, rather than independent contractors. As I said in an even earlier post, it is particularly ironic that Uber and Lyft will have to defend the employee misclassification charge in their own back yards, since both firms were originally founded in Silicon Valley. Notwithstanding the potential difficulties in California, the Uber/Lyft business model appears to be alive and well in Alaska, if the introduction recently of House Bill 120 (and a sister bill, Senate Bill 58) is any indication.

The bills would:

  • amend Alaska Stat. § 23.30.230(a) so as to exclude from coverage under the workers’ compensation chapter any person operating a motor vehicle that is owned, leased, or authorized for use by the person—so long as it isn’t a taxicab defined in another subsection—used to provide “transportation network company services” under an agreement with a “transportation network company;”
  • amend Alaska Stat. § 23.30.230(c) so as to define a “transportation network company” as an entity that “uses a digital network or software application to connect passengers to transportation network company services provided by transportation network company-endorsed drivers; and
  • would also amend Alaska Stat. § 23.30.230(c) so as to define ”transportation network company services“ as ”transportation of a passenger between points chosen by the passenger and prearranged with a transportation network company-endorsed driver through the use of a transportation network company’s digital network or software application.”

Uber/Lyft are, of course, obvious examples of “transportation network” companies. Whether Uber/Lyft drivers are deemed to be employees or not, the proposed legislation would exempt them from workers’ compensation coverage in the same fashion as the following are currently excluded:

  • part-time baby-sitters;
  • cleaning persons;
  • harvest help and similar part-time or transient help;
  • persons employed as a sports official on a contractual basis and who officiate only at sports events in which the players are not compensated;
  • persons employed as an entertainer on a contractual basis; and
  • commercial fishermen, as defined in Alaska Stat. § 16.05.940.

I’ll keep you posted on further developments.