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Yelp Lawsuit Could Mean Guest Reviewers Can Get Back Pay

A recent class action lawsuit filed in California could result in getting unpaid wages for Yelpers, or Yelp Reviewers. The lawsuit states that the Fair Labor Standards Act (“FLSA”) law has been violated by Yelp. Although the lawsuit seems ridiculous, the attorneys of the case believe otherwise. If the lawsuit is successful it could set precedence for numerous similar lawsuits. Next, people might sue any site that accepts free reviews or guest article posts!

yelp reviews Yelp Lawsuit Could Mean Guest Reviewers Can Get Back Pay

I spoke to Daniel Bernath, one of the attorneys at “The Yelp Class-Action Law Firm,” the law firm created just to bring this lawsuit forward.  He felt that Yelp is violating current laws by the way it treats its reviewers. The lawsuit claims that reviewers are encouraged to write free reviews and  instead of payment, they are awarded badges, such as “Elite” Status, “First to Review,” “Review of the Day,” “Duke,” “Duchess, ” “King,” and “Queen.”  In addition, Yelp often holds parties for their Elite reviewers where they offer them free drinks and food. The lawsuit also claims Yelp has a cult like environment.

I reached out to Yelp for commenting. They called the lawsuit “frivolousand think the court system will be wasting its time. Here is what their PR rep had to say:

“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.”

I also talked to a couple of attorneys to get some legal expertise regarding the chances of this lawsuit prevailing.

Eric Goldman, a law professor at Santa Clara University School of Law, feels that:

“This lawsuit is doomed to fail.  It’s a broad-based attack on the user-generated content (UGC) ecosystem, and there’s no chance that courts will say that every author publishing their content online are employees of the publishing websites.”

However Mr. Goldman feels that the Elite users may pose a more serious challenge, as “its Elite members check off more factors on the various multi-factor tests for classifying employees.”

Mr. Goldman has written about a similar case. In 2012, the Huffington Post won a case brought forward by unpaid contributors.

Aaron Minc, a Defamation Attorney, has a detailed analysis of this case on his blog. He states:

“Yelpers sign up for Yelp pursuant to its “terms of use” and are not “hired” or “fired.” Yelpers write content how, when, and where they want. Finally, Yelp users are neither given nor promised any formal monetary compensation.”

If this lawsuit prevails, many online review websites and news websites that accept guest posts will need to revise their business practices. Review websites may actually have to start paying reviewers a small fee or come up with some solid proof agreements with their reviewers to avoid getting sued in the future.

For those interested in joining the lawsuit or to learn more about it, visit http://www.yelpclassaction.info.

Screenshot of Yelp.com taken November 2013.

pierre zarokian 250x250 Yelp Lawsuit Could Mean Guest Reviewers Can Get Back Pay
Pierre Zarokian is a veteran in search engine marketing. He launched Submit Express in 1998, which offers search engine marketing services and SEO tools. Ranking at #1 spot in Google for "search engine optimization" in mid 2000's is one of his major accomplishments. Pierre Zarokian also runs Reputation Fighters, a reputation management company.
pierre zarokian 250x250 Yelp Lawsuit Could Mean Guest Reviewers Can Get Back Pay

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9 thoughts on “Yelp Lawsuit Could Mean Guest Reviewers Can Get Back Pay

  1. Pretty interesting. I think this is only the beginning for the FTC and FLSA to be getting involved in these type of matters. First they can make an example out of Yelp, and if they win, all of the smaller sites will soon follow after. Here comes the regulations!

  2. Where do you post reviews for the law firm bringing this class action? ;) Sounds like a complete waste of time. I can’t imagine any court in any country upholding such an absurd claim.

    1. Matt, the attorneys formed a new firm called “The Yelp Class-Action Law Firm.” I do not think they are listed in any directories or yellow pages, so you won’t be able to post reviews.
      However, as stupid as it may sound, the laws are actually in their favor on this. They may actually have a good chance of winning. I have talked in length with the main attorney about this.

      1. I was being ironic. I’m not sure how the precedent system works in the US, but even if they get a judgment in their favor [sic], then as they sued on the basis of a Federal rather than a State law, does this set a precedent for all cases being brought in other states?
        Surely there are also massively complicated jurisdictional issues with any of this anyway as it’s related to internet use?

  3. You’ll rarely find me defending Yelp, but in this case the lawsuit is ridiculous. I’d like to get a little more background on the attorney’s that are filing the suit. It’s possible they’re just pulling a publicity stunt.

    1. I’d be leary of signing on to anything he(Bernath) is involved with. Just google his name… Disbarred in California, and then in Oregon after lying about the circumstances of what led to him losing his ability to practice Law in California. There is much more, but you can be the judge of all that via google search of him.

  4. Sounds bizarre, but if this class-action lawsuit prevails, it may actually “clean up” such UGC sites. Then, review sites like Yelp will have to establish a true screening process for all of their commenters, so they can pay them whatever stipend the courts decide. (This also means fake accounts will have to be shut down and their comments revoked, something that may help lots of small businesses with false bad reviews.)

  5. Yelp pays a portion of its writers but does not pay the other portion of its writers. The lawsuit is merely to force Yelp to pay all writers.