136 | Massachusetts Wage & Hour Peculiarities, 2025 ed. © 2025 Seyfarth Shaw LLP on, carriers’ prices, routes, or services.”791 A significant impact “may be proven by empirical evidence or the logical effect that a particular scheme has on the delivery of services.”792 Applying these principles to the cases before them, the SJC and the First Circuit concluded that the FAAAA preempts the “usual course of business” prong, reasoning that application of that prong would have a significant impact on the prices, routes, or services of the motor carriers at issue.793 Although the First Circuit referred to the “usual course of business” prong as “‘something of an anomaly’ among state wage laws,” the court did not conclude that the prong is preempted by the FAAAA in all cases involving motor carriers. Rather, the First Circuit held that the second prong was preempted as the plaintiffs proposed to apply it in the particular cases before the court.794 3. Independent Trade, Occupation, Profession, or Business The third prong of the ABC test requires a business to demonstrate that the individual is “customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the services performed.”795 This prong focuses on whether the individual could provide the service to anyone willing to engage his or her services (which suggests independent contractor status) or whether the nature of the work requires him or her to depend on a single employer (which suggests employee status).796 While the statute requires that there be the potential for an independent business, it is not necessary that the individual actually run his or her own enterprise.797 For instance, the SJC ruled in Sebago that taxi cab drivers were independent contractors when they were free to (1) lease taxi cabs from different medallion owners that used different dispatch services, (2) accept or reject dispatches, and (3) “advertise their services through personalized business cards.”798 Likewise, news carriers were found to be independent contractors when they were free to deliver papers from other publishers along their 791 Schwann, 813 F.3d at 435 (citing Massachusetts Delivery Ass’n v. Coakley, 769 F.3d 11, 17-18 (1st Cir. 2014)); see also Chambers, 476 Mass. at 101. 792 Massachusetts Delivery Assn., 821 F.3d at 191 (internal quotations omitted); see also Chambers, 476 Mass. at 101 (noting that requiring motor carriers to have employee delivery drivers “likely also would have a significant, if indirect, impact on motor carriers' services by raising the costs of providing those services” and referencing the cost of minimum wage as an example) (citations omitted). 793 Chambers, 476 Mass. at 102 (holding that usual course of business prong’s “de facto ban [on use of independent contractors] constitutes an impermissible ‘significant impact’ on motor carriers that would undercut Congress's objectives in passing the FAAAA; the statute containing prong two also forms part of an impermissible ‘patchwork’ of State laws due to its uniqueness.”); Massachusetts Delivery Ass’n, 821 F.3d at 192 (holding that application of the usual course of business prong “would logically have a significant effect on [the company’s] routes and services.”); Schwann, 813 F.3d at 438 (holding that application of the “usual course of business” prong would “pose[] a serious potential impediment to the achievements of the FAAAA’s objectives because a court, rather than the market participant, would ultimately determine what services that company provides and how it chooses to provide them”). 794 Massachusetts Delivery Assn., 821 F.3d at 192-93; Schwann, 813 F.3d at 437-40. 795 M.G.L. ch. 149, § 148B(a)(3). 796 Sebago, 471 Mass. at 336 (quoting Athol, 439 Mass. at 180-81). 797 Sebago, 471 Mass. at 336; Athol, 439 Mass. at 180. 798 Sebago, 471 Mass. at 336-37.
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