Prohibiting Class Action Lawsuits Over the Misclassification of Contractors in the "Gig Economy" (H.R. 5367)

What is H.R. 5367?

(Updated March 16, 2019)

This bill — the Protect the Gig Economy Act of 2018 — would prohibit class action lawsuits alleging the misclassification of employees as independent contractors from being filed against businesses. The right of workers to individually sue for alleged misclassification would not be impacted.

Argument in favor

Many small businesses in the “gig economy” rely on independent contractors for their operations, and they can’t afford the threat of class action suits alleging the misclassification of employees.

Argument opposed

Many businesses use independent contractors to fill important roles within the organization, and if the lines between contractors and employees become blurred those workers should be able to file class action lawsuits.

Impact

Workers who would file class action lawsuits alleging misclassification of employees as independent contractors; businesses utilizing such workers; and the courts.

Cost of H.R. 5367

A CBO cost estimate is unavailable.

Additional Info

In-Depth: This bill was introduced by Rep. Andy Biggs (R-AZ) to prevent gig economy companies which rely on an independent contractor business model from facing class action lawsuits alleging the misclassification of workers who are employees.

Federal courts have ruled on several misclassification suits involving gig economy companies, finding in each that the workers involved for Grubhub and Uber were properly classified as independent contractors.

Media:

• JD Supra (Context)