A team of CRA Labor & Employment experts supported Dr. Jonathan Guryan, who testified as an expert witness in a matter involving allegations of independent contractor misclassification in the trucking industry.
Plaintiffs claimed that the drivers were misclassified as ‘independent contractors’ when they should have been classified as employees. Plaintiffs claimed damages related to missed meal and rest periods, minimum wages, and failure by the employer to reimburse expenses.
Dr. Guryan presented an economic model of how businesses make decisions to maximize revenues and minimize costs, retaining the difference between revenues and costs as profits. Dr. Guryan explained that the contractors in this case undertook various actions and made various decisions that influenced their revenues and costs, consistent with the standard economic model of a profit-maximizing business.
Additionally, Dr. Guryan showed how many of the contractual obligations agreed to between plaintiffs and the defendant company were consistent with the types of contractual arrangements that economic theory predicts that independent businesses would enter to alleviate the effects of free-riding and spillovers. The case ultimately settled prior to trial.
