Court rules Uber and Lyft must face worker-misclassification lawsuit from Massachusetts’ attorney general

Uber Lyft

A Massachusetts state court on Thursday rejected requests by Uber and Lyft to dismiss a lawsuit accusing the companies of illegally misclassifying their drivers as independent contractors.

The lawsuit, brought by the Massachusetts state attorney general Maura Healey in July, alleged the companies have denied drivers benefits and workplace protections guaranteed to employees by instead classifying them as contractors.

Uber and Lyft then asked the court to toss the case, arguing the state hadn’t done enough to prove drivers were denied benefits and that there wasn’t a legitimate legal dispute over the issue. The court denied both companies’ requests, allowing the case to proceed.

Uber and Lyft did not respond to requests for comment on this story, while labor and driver groups praised the ruling.

“This court order is a complete rejection of Uber and Lyft’s position and a big win for working people,” Massachusetts AFL-CIO president Steve Tolman told Insider in a statement.

“Every worker should be able to earn a decent wage, take care of their health, and protect against harassment and discrimination on the job. We thank Attorney General Healey and her team for holding Uber and Lyft accountable for following the same rules that apply to every other company,” Tolman added.

The two ride-hailing giants have faced an increasing number of legal challenges in recent years over how they classify workers amid growing evidence many drivers are paid less than the minimum wage, and have struggled – particularly during the pandemic – without access to health care, labor protections, and unemployment benefits guaranteed by law to employees.

While companies are typically required to pay into state and federal programs benefiting their workers, Uber and Lyft have passed those costs on to taxpayers. A recent Washington Post analysis found more than 27,000 Uber and Lyft drivers received a combined $80 million from the US government to help them get through the pandemic.

The companies have argued drivers should be considered contractors because they’re able to choose when they can work and which rides they accept, claiming the companies are simply technology platforms that connect drivers and riders.

But a UK court recently rejected that argument, finding Uber and Lyft exercise significant control over drivers – much like a traditional employer – by setting their rates, assigning them rides, and using a rating system to determine their ability to get work on the platform. Uber responded by reclassifying its drivers as “workers,” a category under UK law between employment and contractor, in order to head off further legal disputes with drivers.

California regulators and courts also rejected the arguments put forth by Uber and Lyft, but the companies – along with a coalition of food-delivery companies including DoorDash and Instacart – avoided having to comply with those rulings by spending a combined $200 million to persuade voters to pass a law they wrote that keeps drivers as contractors.

The companies have also spent record amounts on lobbying as the worker classification issue takes the national stage.

The Biden administration’s proposed PRO Act, which wouldn’t automatically reclassify gig workers but would make it easier for them to unionize, has elevated the discussion around which rights and benefits rideshare and food-delivery workers should have – and who should bear those costs.

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Alchemista used to provide corporate catering for Moderna and TripAdvisor. It’s now using food lockers to deliver chef-made meals.

Alchemista
  • Alchemista is deploying temperature-controlled food lockers in offices and residential blocks.
  • The lockers sell chef-made meals, are cleaned by UV light, and are contactless.
  • Company CEO, Christine Marcus, told Insider why she decided to get into the food locker market.
  • Visit the Business section of Insider for more stories.

When the pandemic hit, business dried up for Boston-based corporate catering company Alchemista.

It had previously provided food for staff at companies including Splunk and TripAdvisor. As people switched to working from home, Alchemista was left with only one main client – pharma giant Moderna, which has developed a coronavirus vaccine.

But Alchemista’s CEO, Christine Marcus, used this as an opportunity to pivot her business. It’s launching a network of patent-pending food lockers, which will be deployed across offices, schools, and residential blocks and stocked with chef-made meals.

The company is focused on expanding them to residential buildings, Marcus told Insider, but also plans to roll them out to offices, college, and university campuses.

The lockers are simple to use. You scan the QR code on the locker’s tablet screen, which takes you to a payment site. After you’ve paid, the locker unlocks. This means you don’t even need an app to use them – and the whole process takes four seconds, Marcus said.

Because they’re contactless, they’re suitable for use during a pandemic, too.

from on Vimeo.

The lockers are temperature-controlled, with different versions available for heated, ambient, and refrigerated meals, and they use UV light, which the company said kills 99.9% of bacteria.

As well as an on-demand service, Alchemista lets you order up to 12 hours in advance, too, via its website.

Alchemista doesn’t just provide the lockers. It provides the food, too. It has an in-house culinary team that makes the meals and delivery drivers who bring them to the lockers each day.

Alchemista pivoted to food lockers after its corporate catering business came to a “screeching halt”

Before the pandemic, companies were trying to boost their corporate perks with offerings such as free meals to attract staff in cities with competitive labor markets – like Boston.

Alchemista launched in the Massachusetts city in 2012 to provide off-site, high-quality, chef-made meals to businesses who would essentially outsource it with the management of their food and beverage program. At first, Alchemista used third-party restaurants, but by 2019 it was delivering around 2,000 meals a day, and restaurants might not be able to keep up.

With this in mind, it decided to launch an in-house culinary team, which went on to provide most of its meals. It also launched operations in New York and Washington, DC where it experienced rapid growth, Marcus said.

Unfortunately, the pandemic caused the business “came to a screeching halt,” because it exclusively provided corporate catering, she said. “COVID basically brought our business to a complete stop, except one customer,” she added.

The business pivoted to food lockers selling individually boxed meals. Alchemista had the technology to deploy them before the pandemic, but because corporate catering was focused on encouraging staff to be social, people weren’t interested.

Alchemista food locker
Alchemista’s food lockers are six foot tall.

As well as chef-made meals, the lockers also sell charcuterie kits and snacks such as bagels made by a local bakery. This means the lockers can give smaller food businesses the opportunity to reach more customers.

Alchemista also provides high-tech contactless vending machines that allow customers to select products using an app.

Marcus said the trend of companies providing corporate catering would continue after the pandemic but as people adopt flexible working patterns, companies might pivot to food lockers instead. “I think it’s going to be a very different world when people go back to work,” she said.

The compact nature of food lockers – Alchemista’s larger versions have space for 19 meals and are roughly 6 foot by 2.6 foot – enables companies to reduce their real estate footprint, compared with on-site catering.

It’s not just offices that Marcus has her eyes on. In Boston, she’s rolling out lockers in the lobbies of residential blocks, where people can collect restaurant-made meals prepared by James Beard award-winning chefs, including wild mushroom risotto, paella, and braised beef.

Marcus hopes to expand even more in the future, too. She envisages the food lockers could be deployed across train stations, bus stops, college campuses, and schools.

Dynamify, a company that provides software services to contract caterers including Alchemista, told Insider demand for food lockers had “exploded” during the pandemic, especially in pharma companies and hospitals.

“In the long-term, we don’t believe food lockers will completely replace traditional restaurant pick-up,” Dynamify’s CEO, Maxwell Harding, said.

“However, we do see food lockers persisting in restaurants with 24/7 customers, particularly manufacturing sites and hospitals,” he added, noting they’re particularly useful for staff working night shifts.

Food lockers are also being used in restaurants for customers who don’t want to dine in. Burger King, KFC, and Smashburger are all launching food lockers, and Automat Kitchen and the Brooklyn Dumpling Shop are attempting to revive the automat.

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Rural communities are pushing back against vaccine-scheduling bots they say are giving out-of-towners an upper hand

vaccine wars
Some communities are fighting back against vaccine scheduling bots that they say give the tech savvy out-of-towners the upper hand.

  • Vaccine-scheduling bots intended to make registration easier on seniors are facing backlash.
  • A clinic in rural Massachusetts was canceled after 350 shots were reserved by out-of-towners. 
  • As of Feb. 26, more than 70 million people received COVID-19 vaccine shots in the US, the CDC said.
  • Visit the Business section of Insider for more stories.

On February 19, health officials in Franklin County, Massachusetts, learned they’d be receiving 350 new doses of COVID-19 vaccine to make available to their residents at a local clinic.

But less than 10 minutes after the scheduling link was posted to the state website, all of the appointments were scooped up – 95 percent of them by out-of towners, Emergency Preparedness Program Manager Tracy Rogers told Insider.

“Most of them were all gone at the same time, so we knew it was not a human being that could be doing it that quickly,” she said. “Then we found out that there is both a Twitter hashtag and a website that people can go to and sign up and the bot will just scour the state website all day long signing them up.”

Bots, autonomous internet tools designed to perform specific functions, have started to pop up in an effort to help Americans find and schedule vaccine appointments. But when online vaccine registrations rolled out, some people were left frustrated because appointment slots would disappear while patients, usually seniors who were among the first wave of people who could be vaccinated, were in the middle of trying to sign up. 

Registration systems around the US have been challenging, especially to those who are less tech-savvy. 

People trying to fix a broken system, have started to develop bots to make it easier to schedule appointments.

Some of the new bots are built to scan vaccine websites to determine when a clinic is adding new appointments, and then alerting the human overseeing them to post an alert online, the Associated Press reported. 

Others are “scalper” bots that automatically book appointments, according to the AP. 

While the bots might be well-intended, the downside is that they might not be sophisticated enough to factor in local regulations. 

In Franklin County, a community of just over 70,000 residents, this week’s clinic was intended to be limited to locals.

It was expected that some portion of the appointments would be made by people living outside of the county, but in this case, almost no Franklin residents had the opportunity to register. 

“It’s a wonderful service. It’s a great thing,” Rogers said of developers building bots to help seniors sign up. “But the bot doesn’t read where we said this was restricted to Franklin County residents only.”

Many people who signed up for the Western Massachusetts clinic were from the Boston-metro area.

Others who signed up for clinics in Franklin and the neighboring Western Massachusetts community of Berkshire County were driving more than three hours from Cape Cod for the shots.

As of February 26, more than 70 million people have received COVID-19 vaccine shots in the US, according to the Centers for Disease Control and Prevention.

Rogers said officials in Franklin County were able to meet with state legislators to get permission to cancel all 350 appointments and then reschedule the clinic, making it “private.”

Doing so means the new clinic’s registration link would not be available on the state’s website. 

Details were instead distributed to local seniors’ centers, the Council on Aging, and other groups so they could assist with signups. Within two hours of reposting the new link, all of the appointments were rescheduled by local residents and people in nearby rural Massachusetts communities.

Rogers told Insider the problem has been fixed for now, but she’s not sure how long the state will give the county permission to keep vaccine clinics private.

Some eastern Massachusetts residents who were allowed to keep their appointments never showed up. 

“The found out they got in at Gillette Stadium and they never called us to cancel,” Rogers said. 

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