By: Ty Hyderally, Esq. and Francine Foner, Esq.

August 17, 2026

For years, policymakers, courts, and labor advocates have wrestled with a fundamental question: when does a worker labeled as an “independent contractor” actually function as an employee? The issue has become particularly significant in the last-mile delivery industry, where companies such as Amazon rely heavily on subcontracting models and delivery networks that blur traditional employment relationships. The proposed New York City Delivery Protection Act (the “Act”) represents one of the most ambitious efforts yet to address that question and, if enacted, could significantly strengthen protections for delivery workers.

The Act has recently gained significant momentum. Following Mayor Zohran Mamdani’s public endorsement on August 10, 2026, and growing support from a supermajority of City Council members, the legislation appears closer than ever to becoming law.

What Is the NYC Delivery Protection Act?

The Act was introduced in the New York City Council to regulate “last-mile” delivery operations, particularly those utilized by large companies such as Amazon. The legislation would establish a licensing system for certain warehouse and distribution facilities, impose safety and training requirements, and most notably require companies operating those facilities to directly employ workers performing core delivery functions rather than relying on subcontracting arrangements.

Major delivery companies regularly exercise substantial control over drivers’ schedules, routes, productivity expectations, uniforms, technology, and performance standards. Yet at the same time, these companies use subcontracting as a means of trying to avoid the legal responsibilities associated with direct employment. The proposed legislation would require such workers to be hired as direct employees, placing responsibility for worker safety, labor compliance, and employment conditions directly on the companies benefiting from the workers’ labor.

Why the Debate Matters: Employee vs. Independent Contractor

The distinction between an employee and an independent contractor carries enormous legal consequences. Employees are generally entitled to minimum wage protections, overtime pay, workers’ compensation benefits, unemployment insurance, discrimination, whistleblower, anti-retaliation protections, and the right to organize under various labor laws. Independent contractors, by contrast, typically are at risk for not receiving some of those protections.

The delivery industry has become a focal point of classification disputes because many drivers perform work that appears indistinguishable from the company’s core business. Workers often wear company-branded uniforms, drive company-branded vehicles, follow company-created routes, and are monitored through company technology platforms. Yet, despite all this level of control, companies try to argue that the drivers work for an independent business or are contractors themselves.

Recent Legal Developments Involving Amazon Delivery Drivers

Recent litigation and administrative proceedings have increasingly focused on the degree of control that Amazon exercises over its delivery workforce.

One particularly notable development came in 2024 when the National Labor Relations Board’s General Counsel and regional officials advanced a joint-employer theory involving Amazon’s Delivery Service Partner (DSP) system. According to reports, the NLRB concluded that Amazon exercised sufficient control over DSP drivers’ working conditions to be treated as a joint employer for purposes of federal labor law. The proceeding challenged Amazon’s longstanding position that DSP drivers are employed solely by the independent businesses that contract with Amazon.

The rationale underlying such determinations is significant. Courts and agencies increasingly look beyond formal contracts and focus instead on practical realities, including:

• Who controls work performance.
• Who establishes delivery quotas.
• Who determines schedules and routes.
• Who monitors workers through technology.
• Who has authority over discipline and termination.
• Whether the work performed is central to the company’s business.

Similarly, thousands of Amazon Flex drivers nationwide have pursued claims alleging that Amazon misclassified them as independent contractors rather than employees. Those claims typically focus on the extensive controls imposed through Amazon’s Flex platform despite drivers being labeled as contractors.

These developments reflect a broader trend in worker-classification law: decision-makers increasingly scrutinize substance over form and examine whether a worker truly operates an independent business or is economically dependent on the company directing the work. For example, on March 5, 2026, the New Jersey Department of Labor adopted new regulations that clarify how to determine whether a worker is an independent contractor or employee. (See our blog, “A Win for NJ Workers: New Rules Target Misclassification”).

Why the Delivery Protection Act Would Favor Workers

From a worker-protection perspective, the Act would be transformative.  The Act shifts the analysis away from lengthy factual disputes over control and classification. Instead of forcing drivers to litigate whether they are employees under various tests, the Act would require large delivery companies to directly employ workers performing delivery services. As a practical matter, workers would gain access to benefits and protections traditionally associated with employment relationships, including wage-and-hour protections, unemployment benefits, and stronger workplace safety obligations.

The legislation would also reduce the ability of large corporations to distance themselves from workplace injuries, discrimination claims, wage disputes, and labor organizing efforts by pointing to intermediary subcontractors. This would create greater accountability and improve working conditions throughout the last-mile delivery sector.

New Jersey’s Approach: One of the Nation’s Strictest Tests

New Jersey already has one of the most employee-friendly worker classification frameworks in the country.

Under New Jersey law, workers are presumed to be employees unless the company proves all three elements of the state’s well-known “ABC Test.” Specifically, an employer must establish:

1. The worker is free from the company’s control and direction.’
2. The work is outside the usual course of the company’s business (or outside all of its places of business).
3. The worker is customarily engaged in an independently established trade or business.

If the company fails any one of these elements, the worker is classified as an employee.

Amazon and Delivery Drivers in New Jersey

New Jersey has not limited itself to general worker-classification enforcement. In October 2025, the New Jersey Attorney General and Department of Labor filed suit against Amazon alleging that the company misclassified Amazon Flex drivers as independent contractors under New Jersey law. The complaint alleges that Amazon retains substantial control over drivers while shifting operational expenses and business risks onto workers.

According to the State, Amazon’s Flex model fails the ABC Test because:

• Delivery driving is central to Amazon’s business.
• Amazon exercises significant control over delivery performance.
• Drivers are not operating truly independent delivery enterprises.

Although that litigation remains pending, it demonstrates that New Jersey regulators are aggressively challenging delivery-industry contractor models.

Looking Ahead

The Act reflects a larger national trend. Legislatures, regulators, courts, and administrative agencies increasingly question business models that depend on labeling core workers as contractors while retaining extensive control over their day-to-day activities. Recent developments involving Amazon delivery drivers, coupled with New Jersey’s stringent ABC Test, suggest a growing willingness to look beyond contractual labels and focus on economic realities.

If adopted, the Act could become one of the most consequential local labor laws in the country, effectively requiring major delivery companies to assume responsibility for the workers who power their delivery networks. For employees, that represents a significant step toward greater accountability, stronger workplace protections, and clearer recognition that workers performing the core business of a company should often be treated as employees, not independent contractors.

If you have any questions regarding your rights as an employee, you should seek an experienced attorney who concentrates in employment law. Our firm has been concentrating in employment law for over twenty-three (23) year

En nuestra firma hablamos español. This blog is for informational purposes only. It does not constitute legal advice and may not reasonably be relied upon as such. If you face a legal issue, you should consult a qualified attorney for independent legal advice regarding your particular set of facts. This blog may constitute attorney advertising. This blog is not intended to communicate with anyone in a state or other jurisdiction where such a blog may fail to comply with all laws and ethical rules of that state or jurisdiction.