DEAR CARRIE: My grandson works for a taxi service and has to pay for everything. He pays for gas, he pays for the ignition key each day and he pays for damage to the car, including $300 once for a broken headlight. He is lucky if he comes home with $25. He depends on tips that people give him, but you'd be surprised how many customers skip out on paying for their trips, let alone leave a tip. The boss collects the payments and gives my grandson a small percentage. But once he pays for everything, he comes home with very little. I am helping him out, but it's difficult because I am on a fixed income. Is the taxi service breaking the law by not paying my grandson a salary?
-- Granny's Tapped Out
DEAR GRANNY: Whether the cab company is acting illegally depends on whether your grandson works as an employee or an independent contractor, said employment attorney Richard Kass, a partner at Bond, Schoeneck & King in Manhattan.
If your grandson keeps the fares, works without supervision and just gives the taxi company a leasing fee based on how many hours he has used the cab, then he is an independent contractor and isn't protected by labor laws, Kass says. And the company wouldn't have to pay him wages.
"The taxi company would have the right to charge him for damage caused to the cab while he was using it," Kass said, "and if he ends up with only $25 at the end of a shift, then that is his bad luck." By the same token, he added, if your grandson has a particularly profitable shift and winds up $1,000 ahead after expenses, the taxi company wouldn't have any claim to that.
On the other hand, if your grandson is required to give the taxi company all of his fares and gets to keep just a small percentage of them, he would probably be considered an employee. That's especially true if the taxi company also requires him to work set hours or to follow the instructions of a dispatcher, Kass said.
As an employee, he would have to be paid at least the minimum wage, currently $7.25 per hour, and he could not legally be required to pay for his own gas or for damage to the cab, Kass said. He would also be entitled to overtime pay of 11/2 times his regular hourly rate when he works more than 40 hours a week.
So your grandson needs to verify his employment status to determine if he is being underpaid. Have him call the U.S. Labor Department at 516-338-1890 for more information.
DEAR CARRIE: We work for a local company and have not been paid for five weeks. Do we qualify for unemployment benefits? There are 30 to 40 of us.
-- All Work, No Pay
"The DOL does not expect people to work without getting paid; so the employees would be eligible to file for [benefits]," the department says.
Even if you quit, you could still be eligible, given your circumstances. Generally, employees who resign from a job don't qualify for jobless benefits.
"[But] if they went unpaid for five weeks, this would be considered good cause for quitting the job," the department said.
In the meantime, you and your co-workers should file a claim to recover the money you are owed.
"The employees should first and foremost file a labor standards complaint for the unpaid wages," the department said.
For more information on the difference between employees and independent contractors, go to http://1.usa.gov/Xlm1FZ
To download a form used to file for unpaid wages, go to http://bit.ly/uSI2yr