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Food Delivery Service Ordered to Pay Workers’ Comp Claims

Delivery man delivering food to a woman at home

In this age of smartphones and apps, ordering food and other necessities with a few taps of a finger has become the norm. Many businesses are trying to break into the industry — some of which are cutting corners to do so. Such was the case with Postmates, a startup delivery company. They have been ordered to pay workers’ compensation premiums from the last two years for its more than 3,000 couriers in Washington state. However, Postmates is fighting the court decision.

Postmates had not paid the premiums because it viewed couriers as independent contractors, much like Uber and Lyft do. After a couple of the couriers filed workers’ compensation claims, the Washington Department of Labor and Industries audited the company and discovered their lack of coverage.

The Department of Labor and Industries discovered about $320,000 in workers’ compensation premiums that had not been paid. In addition, it was discovered Postmates had not properly reported workers to the Department, and said workers were not exempt from workers’ comp coverage in Washington.

This is just the latest in a long string of legal battles between the courts and the “gig economy.” It is estimated that, by 2020, nearly half of the economy could consist of independent contractor jobs. As such, more progressive states like Washington and California are attempting to get ahead of the trend by including such contractors in a business’s workers’ compensation coverage. However, under current law, Postmates is arguing that, since their couriers are not actual employees, the company should not have to pay for workers’ compensation claims.

There is no set date for the case to go to court again.

If you or a loved one has been injured at work in South Carolina, and your workers’ compensation claim has been denied, contact the attorneys at Howell & Christmas today for a free consultation.