Postmates settles class action brought by drivers

OAKLAND -- Online delivery service Postmates Inc. reached an $8.75 million settlement with a class of drivers who challenged their classification as independent contractors, an interesting move given that companies such as Uber Technologies Inc. and GrubHub Inc. have recently defeated similar lawsuits.

The agreement suggests that some employers are still not comfortable taking the driver classification issue to trial, despite recent defense victories. Singer et al. v. Postmates, Inc., 15-CV1284 (N.D. Cal., filed March 19, 2015).

The class of Postmates drivers were represented by Shannon Liss-Riordan of Lichten & Liss-Riordan PC, the same attorney who brought the case against GrubHub. U.S. Magistrate Judge Jacqueline Scott Corley ruled in February that the plaintiff in that case, Raef Lawson, was indeed an independent contractor and not a GrubHub employee.

Earlier this month, a federal judge in Philadelphia ruled in another case that drivers for Uber were not employees.

Liss-Riordan has an ongoing case of her own against Uber before U.S. District Judge Edward M. Chen in San Francisco. O'Connor et al. v. Uber Technologies Inc. et al., 13-CV3826 (N.D. Cal., filed Aug. 16, 2013).

U.S. District Judge Jeffrey S. White approved the Postmates settlement at a hearing Friday and granted the plaintiffs' attorneys request for just under $2.2 million, which amounts to 25 percent of the total settlement.

White batted aside several written objections, including one from a class member who was upset by the underlying question of why worker classification wouldn't be resolved in the settlement.

The judge commented that this was the nature of settlements and the agreement was appropriate due to "the totality of the circumstances, including the uncertainty involved and novel legal issues in the 'gig economy.'"

Postmates was represented by Andrew M. Spurchise, a partner with Littler Mendelson P.C.