Aquino v. Uber Technologies, Inc.

Background

Anthony Aquino sued Uber Technologies, Inc., Rasier, LLC, and Schleuder, LLC under the Fair Labor Standards Act (FLSA) and the New York Labor Law. He brought the claims for himself and a proposed group of Uber drivers who had opted out of Uber’s arbitration agreement. Aquino alleged that Uber misclassified him as an independent contractor and failed to pay minimum wage after accounting for unreimbursed vehicle-related expenses.

Aquino alleged that he drove for Uber on three days in April 2022. He received a total of $46.88. He counted time spent logged into the Uber application while waiting for rides as working time and alleged expenses for rideshare insurance, vehicle maintenance, repairs, and gasoline.

The defendants moved to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b). They argued that Aquino had not adequately pleaded an employment relationship, a minimum-wage violation, or willfulness. They also argued that the court lacked personal jurisdiction over possible out-of-state plaintiffs.

Employment Status

The court held that the amended complaint plausibly alleged that Uber was an employer under the FLSA and that Aquino was an employee rather than an independent contractor. Applying the FLSA’s “economic reality” test, the court considered allegations that Uber controlled access to the driver application, set the terms of use, required specified vehicle maintenance and insurance, set fares and compensation, could remove drivers from the application, and automatically logged drivers out after 12 hours.

The court also noted that drivers did not share in Uber’s profits or invest in Uber’s business, that driving required a low degree of skill, and that drivers’ work was integral to Uber’s business. Although Aquino’s short work history and ability to work for other rideshare companies weighed against employee status, the court held that this factor was not decisive at the motion-to-dismiss stage. For similar reasons, the court held that the complaint plausibly alleged employee status under the New York Labor Law.

Minimum-Wage Claims

The court dismissed the FLSA and New York minimum-wage claims because the complaint did not plausibly allege that Aquino was paid less than the applicable minimum wage.

First, the court held that Aquino had not adequately pleaded that his waiting time was compensable. Under the governing standard, waiting time is compensable when an employee is required to wait for the employer’s benefit and cannot use the time effectively for personal purposes. Aquino alleged that he waited in a designated area for ride requests, but he did not allege how often requests arrived, how many requests he had to accept, or that Uber prohibited him from doing other work while waiting. The court also observed that the complaint suggested he could work for another rideshare company.

Second, the complaint did not identify the amount of time Aquino spent driving customers on two of the three workdays. Because it did not establish the total number of compensable hours, the court could not determine whether his pay fell below minimum wage based on customer-driving time.

Third, the court rejected Aquino’s proposed method for deducting business expenses. The complaint did not provide the mileage driven for Uber or calculations showing that unreimbursed expenses reduced his hourly pay below minimum wage. The court also found problems with Aquino’s proposed calculations, including combining actual insurance costs with a standard mileage deduction, counting commuting time, including waiting time in mileage calculations, and allocating a monthly insurance cost to only three workdays without legal support.

Other Issues

The defendants argued that Aquino had not adequately pleaded a willful FLSA violation. The court did not reach that issue because it dismissed the wage claims and found Aquino’s individual claims timely under the two-year limitations period.

The defendants also argued that the court lacked personal jurisdiction over out-of-state drivers who might join the case. The court did not decide that issue because it dismissed Aquino’s claims and because Aquino withdrew claims asserted on behalf of drivers outside New York.

Disposition

Judge Katharine H. Parker granted the defendants’ motion to dismiss without prejudice. The court directed Aquino to follow a separate court order concerning any proposed amended pleading.