BOSTON (CN) — Amid a national debate over whether gig economy workers should be treated as employees or as independent contractors, the Massachusetts Supreme Court seemed inclined at oral argument Monday to approve several November ballot questions that would allow voters to decide the rules.
A group supported by Uber, Lyft, DoorDash and Instacart is promoting ballot initiatives that would establish that the companies’ drivers are contractors who are exempt from the state’s employment laws — which means that they aren’t entitled to minimum wages, overtime, paid sick leave, unemployment insurance or health benefits.
Meanwhile, an initiative promoted by drivers would allow them to form a union and engage in collective bargaining.
Both sides claim the other is trying to confuse voters and “logrolling” by combining unrelated provisions into one petition. The state attorney general’s office approved all the initiatives and found itself in the odd position of defending both sides in court.
The industry, which already has donated almost $7 million to the effort, is promoting five different petitions but says it will submit only one to voters once it’s clear which petitions are legal and can attract enough signatures. Some versions simply say that drivers are contractors; others sweeten the deal by guaranteeing a separate suite of driver benefits.
Under the state constitution, ballot initiatives can’t combine unrelated provisions and must express a unified public policy. “Why isn’t this a public policy?” Justice Dalila Wendlandt asked.
It’s “a long list of unrelated changes” to multiple areas of employment law, argued Jennifer Miller of Hemenway & Barnes in Boston. “It’s difficult for a regular worker to understand what the nuances of being an employee are under different contexts,” she said, which is why workplaces often have posters explaining employees’ rights.
Justice Scott Kafker suggested that the proposal was similar to an earlier ballot initiative that legalized marijuana. “That was creating a whole new industry,” he said.
But legalizing pot, Miller replied, is “something easily understood by the voters.”
Miller also fended off questions about why the petition was different from one that legalized gay marriage, which also affected numerous areas of the law.
Wendlandt remarked: “The petition’s common purpose is, 'We’re not going to do all those employment laws. We’re a different system for which the employment laws don’t work. For those gig economy workers, we’re going to set up a different chapter.' Why isn’t that a common purpose?”
“How can you say that’s unrelated?” demanded Justice Gabrielle Wolohojian.
The justices also had sharp questions for Kevin McGinty of Boston’s Mintz Levin, who argued against the collective bargaining petition.
That petition faces a different hurdle: If the drivers are contractors, they’re prohibited from unionizing by the federal antitrust laws. The petitioners attempt to get around this by giving the state labor department authority to approve or veto any union agreements — but McGinty argued that this “yokes together two unrelated means, collective bargaining and government control,” and would produce “a statute at war with itself.”
However, “I just don’t see why this is a problem,” Kafker replied, adding that if the industry’s petition is valid, then “what’s good for the goose is good for the gander.”
He said the petition was created to navigate around federal law, much as the proposal for marijuana legalization did.
Wolohojian noted that the labor department would use the same procedures as a standard labor arbitrator. “How is it different?” she asked.
“An arbitrator is a standard part of collective bargaining, but government control is not,” McGinty replied. But Wolohojian insisted that “it’s the same principle.”
“It’s not traditional collective bargaining,” Kafker observed, but then the industry’s opposite proposal of exempting a class of workers from the employment laws “isn’t traditional either.”
Arguing for the attorney general, Patrick Moore said that it’s common for ballot initiatives to provide for government oversight and to navigate around federal law, and he gave a number of examples. Moore had 15 minutes to argue, but when he received hardly any questions from the justices, he quit several minutes early — usually a strong sign that an argument is going well.
The one apparent sticking point for the petitioners was that one of the industry’s five proposals would exempt drivers from the state’s discrimination laws and substitute a procedure whereby the employers would decide for themselves whether they had discriminated against anyone.
“Is that a problem?” Kafker asked. “We generally don’t have the person who discriminated decide whether they discriminated or not.”
But Anne Sterman, also arguing for the attorney general, said even if the provision might be confusing to voters or even be illegal, that’s not enough to keep it off the ballot. Initiatives can be blocked only if their provisions are unrelated.
“Bus companies can’t discriminate, right?” Kafker asked. “How does this work with an independent contractor?”
“It’s not clear,” Sterman admitted. “But the provisions are still related.”
The argument came in the wake of a new U.S. Department of Labor regulation designed to make it harder for businesses (including app-based businesses) to claim that their workers are contractors for purposes of federal law.
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