Reviewers Suing Yelp

Plaintiffs filed a California class action lawsuit in Los Angeles on October 22, 2013 against Yelp.  Yelp is a website that provides reviews of different businesses around the world.  The plaintiffs are a group of Yelp reviewers, claiming that they are unpaid writers who are vital to the company’s existence.  In the complaint, plaintiffs refer to themselves as writers and non-wage paid employees who have earned Yelp considerable sums of money.

The complaint states, “The practice of classifying employees as ‘reviewers’ or ‘Yelpers’ or ‘Elites’ or ‘independent contractors’ or ‘interns’ or ‘volunteers’ or ‘contributors’ to avoid paying wages is prohibited by federal law, which requires employers to pay all workers who provide material benefit to their employer, at least the minimum wage.”   The complaint further alleges that Yelp motivates its non-wage-paid writers to increase the volume of their production with incentives in the form of liquor, food, badges, and trinkets.

Lily Jeung, a contributor to Yelp, who was named an “Elite” reviewer, alleges that in order to maintain her status, she was “often directed to write more reviews if in Yelp's opinion her production seemed to slack off.”   Jeung had written about 1,100 reviews when Yelp abruptly closed her account.  Yelp sent an email explaining that it had flagged a number of the reviews she wrote in connection with an investigation of businesses that have tried to pay for positive reviews, as a result, her account was closed and the decision was final.

Anyone who reads online reviews knows it is hard to determine whether an online business review is authentic.  To combat this problem, Yelp has developed a computer algorithm in a continuous effort to identify and filter out phony reviews.  It is this computer algorithm that flagged some of Jeung’s reviews and closed her account.  It is Jeung’s stance that she was “fired from her position with no warning, a flimsy explanation, and no opportunity for recourse or appeal rights.”

Yelp has replied to the allegations by telling Fast Company “The argument that voluntarily using a free service equates to an employment relationship is completely without merit, unsupported by law and contradicted by the dozens of websites like Yelp that consumers use to help one another.”

Yelp’s website success does rely on an active base of reviewers, however opponents to the lawsuit have liken it to Facebook users demanding payment for status posts. Nicholas Thompson of the New Yorker told Bloomberg  that the "plaintiffs write so many reviews -- in some cases more than a thousand each -- for the simple reason that Yelp is an online community in which they enjoyed participating, not for the promise of working as a paid writer.  'They did it for the reasons why we all contribute online. We do it for prestige, we do it to connect with our friends, we do it because we think we're making the web a better place,' he said."

If the plaintiffs are successful in their lawsuit, this would change the landscape of online reviewing.  

The Employment Non-Discrimination Act

Today the Senate has adopted an amendment to the Employment Non-Discrimination Act (ENDA) from Sen. Rob Portman (R-Ohio) that would prevent retaliation against religious organizations.  It was only Monday, the ENDA achieved enough support in the Senate to move the bill towards a vote on final passage.  The ENDA is a bill that would make discrimination based on "an individual's actual or perceived sexual orientation or gender identity" illegal in such areas as hiring, firing and compensation in both the private and public workplaces. The measure would treat "sexual orientation" and "gender identity" in a fashion similar to other federally protected categories, such as race, gender, age and religion.

As it stands now, twenty-one states and the District of Columbia have laws prohibiting workplace discrimination on the basis of sexual orientation and many corporations have their own fully inclusive policies in place.  Current federal laws prevent workplace discrimination based upon age, color, disability, genetic information, national origin, race, religion and, sex, but no such protections occur for sexual orientation and gender identity. 

Different versions of the ENDA have been introduced since 1994 and the Senate last considered a version of ENDA in 1996, but the bill failed by one vote.  There are reports that the bill is unlikely to even be brought to a vote in the House as Speaker John Boehner is not in favor of the bill.  Boehner spokesman Michael Steel said in an email that “The Speaker believes this legislation will increase frivolous litigation and cost American jobs, especially small business jobs.”   The Washington Post has reported that states with laws similar to ENDA “have not seen a noticeable increase in litigation based on sexual orientation or gender identity.”

If the bill is passed, potential remedies for violating the law would be on par with other cases of employment discrimination. The former employee could potentially get the job or promotion they were denied, be awarded back pay and litigation costs and/or related compensatory or punitive damages.