In June, we noted that regulatory and legal actions related to the question of whether-or-not on-demand economy workers are independent contractors or employees are creating bumps in the road to success for many companies, including the the on-demand economy archtype, Uber. In August, we followed-up with a related story after the Wall Street Journal reported that such lawsuits may be creating a drag on the ability of on-demand economy startups to raise venture funding.
As we’ve reported, Amazon is aggressively expanding its involvement in the on-demand economy through such efforts as Amazon Home Services. One of those services, Amazon Prime Now, uses the on-demand model to provide same-day delivery of certain Amazon products. Amazon Prime Now is facing the same types of legal challenges that other on-demand model companies have faced.
According to IT World, Amazon.com is being sued in California courts by former Amazon Prime Now delivery drivers in a proposed class-action suit that alleges that the company misclassifies its workers as contractors rather than as employees with full benefits.
According to the complaint, the plantiffs claim Amazon.com’s relationship with the drivers fit “the hallmarks that would classify them as employees” in many ways, including:
- The former drivers reported to and work exclusively out of an Amazon warehouse
- They were scheduled to work fixed shifts during Amazon Prime Now service hours
- They were required to wear shirts and hats bearing the Amazon Prime Now logo
- They were supplied with a smartphone preloaded with the app
According to IT World, Amazon Prime Now drivers in the Los Angeles are paid $11 per hour but are required to make deliveries in their own vehicles, covering employment-related expenses such as fuel, insurance and maintenance costs out of their own pockets
Amazon.com video promoting Amazon Prime Now