Second Circuit Holds “Delivery Fee” Is Not a Gratuity for Delivery Drivers

In a 5-page summary order issued on March 5, 2020, the U.S. Court of Appeals for the Second Circuit held in Belizaire v. Ahold U.S.A., Inc., No. 19-457-cv, that the “delivery fee” paid by customers of Peapod LLC, a grocery delivery service, was not a charge purported to be a gratuity for an employee within the meaning of the New York Tip Law, codified as New York Labor Law (NYLL) § 196-d. The court reached its decision by applying the standards enunciated in the seminal Court of Appeals of the State of New York case, Samiento v. World Yacht Inc.

Second Circuit Rejects Proportionality Standard in FLSA Settlement Agreements When Determining Attorneys’ Fees

In a 29-page decision, the U.S. Court of Appeals for the Second Circuit held in Fisher v. SD Protection Inc., No. 18-2504, that a district court had abused its discretion by rewriting a Fair Labor Standards Act (FLSA) settlement agreement to modify the allotment of the settlement funds to dramatically reduce the fees and costs provided to plaintiff’s counsel. In its holding, issued on February 4, 2020, the court determined that the district court had committed three errors requiring that its decision be vacated and remanded for further consideration.

New York State to End Subminimum Wage for Miscellaneous Industries

On December 31, 2019, Governor Andrew M. Cuomo announced that he had directed the New York State Department of Labor (NYSDOL) to eliminate the subminimum wage for tipped workers of all employers covered by the Minimum Wage Order for Miscellaneous Industries and Occupations. The governor’s announcement came on the heels of a recently released NYSDOL report that found that wage underpayment in the tip system disproportionately affected women, minorities, and immigrants. Employers that fall under this wage order include nail salons, hair salons, car washes, parking garages, tow truck companies, pet groomers, and tour guide agencies. The order impacts over 70,000 employees in New York.

New York City Legislation Protecting Gig Workers Heads to Mayor’s Desk

On October 27, 2016, the New York City Council passed legislation that would establish protections for freelance workers. “Establishing protections for freelance workers” (Int 1017-2015) protects independent contractors’ rights by requiring that certain contracts be in writing, by establishing payment timelines, by prohibiting retaliation, and by establishing an outreach and education program to assist freelance workers. The first-in-the-nation bill, which is also being referred to as the Freelance Isn’t Free Act, creates penalties for violating independent contractors’ rights, including statutory damages, double damages, injunctive relief, and attorneys’ fees.