The gig economy – spearheaded and underwritten by major gig economy companies such as Uber, Lyft, and Doordash – has launched a high-profile campaign to prevent the application of California’s AB 5 law (and the ABC test it dictates) to determine a worker’s employee status.

On September 25, 2020, the US Department of Labor (DOL) published a Notice of Proposed Rulemaking (NPRM) to develop a consistent test for determining independent contractor (IC) status under the Fair Labor Standards Act (FLSA).

In the Summer edition of The Transportation Brief, we discussed the First Circuit’s recent holding that Amazon’s “AmFlex” delivery drivers are exempt from the Federal Arbitration Act (FAA), even if they do not cross state lines, because the goods they transport are moving in interstate commerce. Since then, the Ninth Circuit has agreed with the First Circuit in another case involving AmFlex drivers (over a strong dissent), while the Seventh Circuit reached the opposite conclusion (i.e., that delivery drivers are not exempt) in a case involving GrubHub.

News regarding independent contractor misclassification considerations continues to make headlines. Among the many reasons that industry leaders follow these developments so closely is their potential to materially impact a business’s sale—both for a seller or a buyer.