Chicago Taxi Drivers File Lawsuit over Wages

Chicago Taxi Drivers File Lawsuit over Wages | Pintas & Mullins Law Firm

Wage, hour and overtime lawyers at Pintas & Mullins Law Firm report on a recent class action lawsuit filed by a group of Chicago cab drivers. The group is filing suit against four of the city’s main taxi companies: Yellow Cab, Chicago Carriage Cab, Flash Cab, and Dispatch Taxi Affiliation.

The drivers claim that the companies misclassify them as independent contractors, which exempts them from receiving overtime or minimum wage pay. Just two years ago, a similar group called Cabdrivers for Justice filed a similar lawsuit without any success.

This time around, the cabbies are saying cab companies are violating the state’s Wage Payment and Collection Act by classifying drivers as independent contractors, forcing them to pay fees in order to drive, failing to reimburse them for necessary expenses, taking shares of their pay, and not paying the $8.25 minimum wage or any overtime pay.

In addition, they claim that the companies do not pay any Social Security contributions, workers’ compensation coverage, disability, and unemployment benefits. They are seeking millions of dollars in compensation for any taxi driver who worked in Chicago over the past decade. Cabbies are typically charged about $90 per day and $500 per week to lease their vehicles, and are intensely regulated by the city itself.

There are currently five individual plaintiffs named in the suit, one of whom recently spoke to the Chicago Sun-Times saying that he is seeking back-pay for the wage theft. He further stated that, since he started in the industry he has been working for less than the state minimum wage, and that the cab companies have been unjustly enriched.

Ride-Sharing Companies Facing Litigation

Cab companies in Chicago have been involved in litigation on their own recently as well, arguing that ride-sharing companies like Uber, Lyft and SideCar need to be more strictly regulated. In February 2014, ride-sharing companies were immensely criticized at a Chicago City Council hearing; one month later, the companies got a chance for rebuttal.

To defend themselves, Lyft, UberX, and SideCar assert that they provide insurance to drivers, conduct extensive criminal background checks, and provide service to customers throughout the city, not just in affluent areas. They argue that their services are thriving in the city because residents are dissatisfied with the current options.

The Finance Committee Chairman Edward Burke, perhaps the loudest critic of ride-sharing, is demanding the city shut down the companies because he believes they siphon business from taxicabs and inflate prices. Taxi companies are concerned over the lack of a level playing field: ride-sharing companies do not have to pay airport departure or ground transportation taxes, nor do are they required to hold city medallions. 

In efforts to partly resolve the issue, Mayor Emanuel recently suggested insurance requirements be bolstered for ride-sharing companies Even more recently, an Illinois House committee suggested several measures to heighten regulation over the ride-sharing industry. Among the suggestions include requiring drivers to obtain chauffeurs licenses, provide services for disabled passengers, and have their hours limited. The companies themselves would have to stop price-gouging (when they charge extra during times of high-demand).

Our team of wage, hour and overtime lawyers will continue to report on these lawsuits as more news surfaces. If you or someone close to you is struggling with unfair pay practices with an employer, contact our firm today for a free legal consultation. We advocate on behalf of employees victimized by illegal workplace wage violators, such as misclassifications.