What's the Problem?
The class action alleges that Uber and Lyft are knowingly and illegally misclassifying drivers as independent contractors rather than employees, according to ABC7 Eyewitness News. Plaintiffs allege that drivers are being deprived of minimum wage, overtime, sick leave, disability insurance, unemployment insurance, and other workplace protections during the coronavirus pandemic.
AB5 is a labor law that took effect January 1, 2020, which makes it harder for companies to classify workers as independent contractors instead of employees who are entitled to minimum wage and benefits.
California represents Uber and Lyft's largest source of revenue. The companies are funding a ballot initiative campaign to exclude their drivers from AB5 while offering new benefits including healthcare coverage.
A federal judge in February 2020 denied Uber's request for a preliminary injunction that would have exempted the company from AB5. However, another judge in January blocked the law from applying to more than 70,000 independent truckers, ruling that AB5 is preempted by federal rules on interstate commerce.
California's lawsuit alleges that Uber and Lyft haven't paid enough payroll taxes as a result of the misclassification. The complaint seeks restitution for unpaid wages owed to drivers, civil penalties, and a permanent ruling that would prohibit the companies from misclassifying drivers in the future.
"At a time when California's economy is in crisis with four million people out of work, we need to make it easier, not harder, for people to quickly start earning," an Uber spokesperson said in response to the allegations. "We will contest this action in court, while at the same time pushing to raise the standard of independent work for drivers in California, including with guaranteed minimum earnings and new benefits."
Do I Have an AB5 Lawsuit?
The Workplace and Environmental Litigation Group at our law firm is an experienced team of trial lawyers that focus on the representation of plaintiffs in AB5 Lawsuits. We are handling individual litigation nationwide and currently accepting new cases in all 50 states.
Again, if you or a loved one was deprived workplace protections during COVID-19 by Uber or Lyft, you should contact our law firm immediately. You may be entitled to a settlement by filing a suit and we can help.