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Wage And Hour Laws For Gig Economy Workers

Wage and hour laws for gig economy workers determine how people performing app-based, freelance, mobile, and nontraditional work are paid under state and federal law. These laws define when employers must provide minimum wage, overtime, and lawful deductions, and whether gig economy workers qualify for those protections. Schwab & Gasparini has earned Super Lawyers, AV Preeminent Martindale-Hubbell Lawyer Ratings, and Best Lawyers. To speak to a Syracuse labor attorney now, call Schwab & Gasparini at (315) 422-1333.

Wage and hour laws apply to gig economy workers in many cases, but protections depend on how the law defines the employment relationship. Under New York Labor Law section 190, a person performing services can qualify for wage protections even when labeled as a contractor. Misclassified workers can file a lawsuit or submit a wage complaint to recover unpaid compensation, overtime, and penalties. Furthermore, tips and bonuses must be properly reported and cannot be used to justify paying less than minimum wage. Schwab & Gasparini’s hardworking New York labor lawyers provide advice and representation to workers and employers in Syracuse and across the state.

What Are “Wage and Hour” Laws for Gig Workers?

Wage and hour laws establish minimum pay, overtime rules, required breaks, and lawful pay practices. These laws include the Fair Labor Standards Act (FLSA) at the federal level, and New York Labor Law sections 190 through 199 at the state level. A person classified as an employee receives these protections, while independent contractors do not. However, a company cannot simply label a worker as a contractor to avoid compliance. Courts will examine the nature of the work, control over scheduling, and how pay is structured.

Summary of Wage and Hour Laws for Gig Economy Workers

Wage and hour laws for gig economy workers govern whether app-based and freelance workers qualify for minimum wage, overtime pay, and other compensation protections under federal and New York law.

• Federal statutes such as the Fair Labor Standards Act and New York Labor Law sections 190 through 199 apply based on the actual working relationship, not contractual labels like “independent contractor.”
• Misclassified gig workers may pursue unpaid wages, overtime, liquidated damages, and other remedies through lawsuits or administrative complaints, with New York law allowing recovery for up to six years.
• Minimum wage rules require that total compensation divided by total hours worked meets statutory thresholds, including consideration of waiting time, onboarding time, tips, and non-discretionary bonuses.

Schwab & Gasparini provides legal services related to labor and employment matters, including wage and hour issues affecting gig economy workers in Syracuse and throughout New York State.

How Does New York Determine Employment Status?

New York uses a multi-factor test to determine employment status. Factors include whether the person uses their own tools, how independently the tasks are completed, and whether the services performed are central to the business. For example, a food delivery app cannot deny wage protections if it controls pricing, schedules shifts, and imposes service standards. These workers often qualify as employees under both state and federal law. Once classified as employees, they become eligible for all wage and hour protections.

Can Gig Workers Recover Unpaid Wages or Overtime?

Yes, gig workers can typically recover unpaid wages and overtime if they have been misclassified. Under New York Labor Law section 198, a misclassified worker can file a lawsuit and recover unpaid compensation, liquidated damages, and attorney’s fees. The law allows recovery for up to six years. Workers can also file a wage complaint with the New York State Department of Labor. The agency will investigate and, in some cases, order payment without the need for any type of hearing.

Federal law also supports recovery under the FLSA. In Tony and Susan Alamo Foundation v. Secretary of Labor, 471 U.S. 290 (1985), the United States Supreme Court clarified that employment status depends on economic reality, not contract labels. Courts in New York apply similar reasoning. For example, in Hart v. Rick’s Cabaret International, Inc., 967 F. Supp. 2d 901 (S.D.N.Y. 2013), dancers labeled as independent contractors were found to be employees based on how the club controlled their work. Gig economy workers can use similar evidence to support their own legal actions.

How Are Tips and Bonuses Treated Under Wage and Hour Laws?

New York Labor Law section 196-d provides that tips belong to the worker and cannot be withheld or redistributed by the employer. Employers cannot use tips to meet the minimum wage unless the worker qualifies as a tipped employee under state rules. This classification comes with strict documentation and notice requirements. Bonuses are also treated based on whether they are discretionary or non-discretionary. A non-discretionary bonus promised for completing specific work is part of the worker’s compensation and must be included in wage calculations.

How Minimum Wage Rules Work for App-Based and On-Demand Jobs

As of 2025, the minimum wage in Syracuse is $15.00 per hour under New York Labor Law section 652. All employees, including those paid per task, must receive this minimum wage for all hours worked. Workers classified as independent contractors do not qualify, but, again, courts can reclassify them if their working conditions meet the employee standard. Companies cannot structure pay to avoid wage laws. If total compensation divided by total hours falls below the legal minimum, the worker can file a lawsuit.

In O’Connor v. Uber Technologies, Inc., 82 F. Supp. 3d 1133 (N.D. Cal. 2015), the court examined whether gig drivers were underpaid once vehicle expenses and unpaid time were considered. Although the decision is not binding in New York, it highlights common wage issues. Courts regularly look at the full scope of work time, not just active service time. For example, wait time between deliveries or unpaid onboarding hours count toward total work time under state and federal law.

If a company pays a worker $50 for a five-hour delivery block, that amounts to only $10 per hour. That worker can typically file a lawsuit or administrative complaint. Companies that fail to adjust rates or offer supplemental pay to reach minimum wage levels can be held liable under state law.

Call Today to Discuss Wage and Hour Rights for Gig Economy Workers

Schwab & Gasparini handles legal matters involving labor and employment, construction and labor law, and workers’ compensation defense throughout Syracuse and nearby areas. For questions about wage disputes, classification errors, or recovery of unpaid compensation, call Schwab & Gasparini at (315) 422-1333. Set up a free legal consultation or case review with one of our reputable Syracuse labor lawyers to get started.

Helpful FAQs about Wage and Hour Laws for Gig Economy Workers

Listed below are several helpful frequently asked questions about fair wages and working standards for gig workers. 

What Are Wage and Hour Laws for Gig Economy Workers?

Wage and hour laws set standards for minimum wage, overtime pay, lawful deductions, and compensation practices. For gig economy workers, these laws apply when the worker qualifies as an employee under federal or state definitions rather than an independent contractor.

How Is Employment Status Determined for Gig Workers?

Courts and agencies evaluate the economic reality of the working relationship using multi-factor tests. Key considerations include the level of control over work, scheduling requirements, pricing authority, and whether the services are integral to the business.

Can a Company Classify a Worker as an Independent Contractor to Avoid Wage Laws?

A company cannot avoid wage and hour obligations solely by labeling a worker as an independent contractor. If the facts show employee-level control and dependence, wage protections may still apply under state or federal law.

Can Gig Economy Workers Recover Unpaid Wages or Overtime?

Misclassified workers may be eligible to recover unpaid wages and overtime under New York Labor Law and the Fair Labor Standards Act. Available remedies can include back pay, liquidated damages, and statutory penalties, depending on the circumstances.

How Are Tips Treated Under New York Wage Laws?

Tips generally belong to the worker and cannot be withheld or redistributed by the employer. Tips may only count toward minimum wage in limited situations that meet strict notice and documentation requirements.

Do Bonuses Count Toward Minimum Wage and Overtime Calculations?

Non-discretionary bonuses promised for completing specific work are considered part of regular compensation. These amounts must be included when calculating minimum wage compliance and overtime rates.

How Does Minimum Wage Apply to App-Based or Per-Task Work?

Employees paid per task or per block must still receive at least the applicable minimum wage for all hours worked. Courts and regulators examine total compensation divided by total work time, including waiting periods and unpaid required activities.

How Can Schwab & Gasparini Assist with Gig Economy Wage and Hour Issues?

Individuals may consider visiting with an experienced attorney at Schwab & Gasparini to learn more about wage disputes, classification questions, and potential legal options. The firm works to ensure clients understand applicable labor laws and available legal paths under New York and federal standards.

Mon Feb 2 2026, 12:00am