February 27, 2020 (NEW YORK) – International law firm Proskauer secured a victory on behalf of client Park West Executive Services d/b/a Town Car International, a TLC-licensed for-hire vehicle base. In a precedent-setting opinion for businesses that rely on independent contractors, the Appellate Division of the New York State Supreme Court, Third Department, reversed two decisions of the Unemployment Insurance Appeal Board that held drivers contracting with Town Car to provide services to customers were employees of the company.

The claimant, who owned and operated his own vehicle and contracted with Town Car to provide executive ground transportation services to customers, filed a claim for unemployment insurance benefits, prompting the New York State Department of Labor to review his employment status. The Department of Labor initially determined that the claimant was a Town Car employee, holding Town Car liable for unemployment insurance contributions. An Administrative Law Judge and the Unemployment Insurance Appeal Board affirmed the agency’s determination.

The Appellate Division reversed the Appeal Board’s decisions, holding that Town Car did not exercise a sufficient level of control over the claimant (or other similarly situated drivers) to establish the existence of an employment relationship. The court reasoned that the drivers controlled their own day-to-day activities (including whether and when they worked), were responsible for their own expenses (including for vehicle acquisition, maintenance, and fuel), and retained ultimate control over the manner and means by which they provided their services.

The Proskauer team included partner Allan Bloom (Labor) and associate Hayley Fritchie.

Proskauer’s leading Labor & Employment group is one of the strongest practices in the world, with lawyers across the U.S., and in London and Paris. We have experience covering every area of labor and employment law and handle the complete range of sophisticated litigation, trial, appellate and counseling, as well as government contractor issues and investigations. Our lawyers handle the complete gamut of litigation matters facing employers, ranging from individual plaintiff lawsuits to highly complex (multistate) class action cases, to EEOC pattern and practice disputes. We consistently receive a top-tier nationwide ranking in Chambers USA and are recognized as leaders by The Legal 500 United States, Benchmark Litigation, among others.  We regularly handle our clients’ most complex matters and are trusted advisors on everything impacting the workplace.