New Fronts on California’s War Against Uber and Lyft

Uber and Lyft have successfully battled suits seeking to prevent the companies from classifying their drivers as independent contractors, until now.

On August 10 – in a misclassification action pending in San Francisco – the court issued a preliminary injunction requiring Uber and Lyft to convert their independent contractors to employees until final decision at trial. However, the judge put order on hold for 10 days to permit the companies to appeal the order to the Court of Appeal.

Another attack line opened this month, a Labor Commissioner complaint filed  in Oakland claiming Uber and Lyft are engaging in “wage theft” by characterizing an estimated 100,000 drivers each as independent.  The suit seeks recovery for minimum wage, overtime, rest breaks, paid sick leave, expenses, and mileage, as well as penalties, interest, and attorney fees.

Meanwhile, these rideshare giants have qualified Proposition 22 for the November 3 ballot, seeking voter override of the state’s efforts to end their independent contractor business model.

On the PR front, Uber’s CEO August 10 op-ed in The New York Times (“Gig Workers Deserve Better”) challenged the current “either/or” divide with a  middle “third way” permitting the  flexibility a majority of gig drivers want along with employment benefits not currently received.

Regardless of how all this settles out, seeking expert advice from a management-side employment attorney is crucial for a business contemplating hiring workers – or continuing to classify them – as independent contractors.

See also:

• Is Gig Up for Car Wash Company? – First AB 5 Suit Challenging Independent Contractor Classification (July 30, 2020)
• Calling Out Big Gig – California Wants Uber and Lyft Drivers as Employees (May 22, 2020)
• Roadkill – Federal Court Denies Uber Request to Stop AB5 (February 21, 2020)
• The Mystery of it All – Employed or Independent? California Offers AB5 Answers (February 7, 2020)
• Dodging the Bullet – The Industries and Professions Not Subject to California’s New Independent Contractor Restrictions (October 9, 2019)

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Helena Kobrin

August 13, 2020