Bill would classify app drivers as contract workers

The Business and Labor Committee heard testimony March 13 on a bill that would ensure Nebraskans who engage in marketplace network platforms remain independent contractors.

LB489, introduced by Elkhorn Sen. R. Brad von Gillern, would clarify state law to ensure that workers who use technical applications for marketplace network platforms, such as Uber and Lyft, are classified as independent contractors. The bill notes that individuals engaged in such work cannot be fired for denying a work request or be required to meet a certain number of hours to maintain employment status.

Drivers on ride-hailing platforms should be able to maintain their status as independent contractors, von Gillern said, despite a push at the federal level to make Uber and Lyft drivers traditional employees. Ride-hailing drivers choose if, when, where and for how long they work, he said, and because there’s no exclusivity, many use multiple apps for work.

“Unfortunately, the current administration and a handful of special interests in [Washington] D.C. continue to pursue policies that could limit drivers’ flexibility and risk the future of rideshare in our state,” von Gillern said. “LB489 removes the uncertainty and ensures workers on rideshare platforms in Nebraska remain as independent contractors.” 

Twenty-one states already have passed similar legislation, he said, including South Dakota, Iowa and Wyoming. 

Freddi Goldstein, testifying on behalf of Uber, spoke in support of the bill. Uber provides drivers with flexibility, Goldstein said, which has been especially important amidst record inflation that has forced many Americans to supplement their income. According to the data, she said, a majority of drivers want to remain independent contractors.

“Flexibility doesn’t just benefit workers. It’s a big part of the reason Uber is able to serve rural, suburban and urban communities across the state,” Goldstein said. “If Uber were forced to switch to an employment model, less densely populated areas of the state would likely no longer benefit from on-demand rideshare.”

John Corrigan, representing the Nebraska State AFL-CIO, testified in opposition to the bill. The push for drivers to maintain their status as independent contractors comes from the industry itself, he said, in an effort to misclassify workers so that they lose traditional employment protections.

There are certain things employers are required to do, Corrigan said, including providing security through unemployment benefits to individuals who give their time and effort in exchange for money.

The committee took no immediate action on LB489.