Uber, Lyft might be required to make chauffeurs workers under brand-new California court order

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Uber chauffeurs likewise objected in front of the business head office in May. 


James Martin/CNET

Uber and Lyft might be required to reclassify their chauffeurs as workers in California in coming weeks. The state’s Attorney General Xavier Becerra revealed Wednesday he’s submitting an initial injunction versus the 2 business, speeding up a currently heated fight in between California and the ride-hailing services.

The injunction follows Becerra and the city lawyers of Los Angeles, San Diego and San Francisco taken legal action against Uber and Lyft last month. They state the business are breaching a state law called AB 5 by declining to make their chauffeurs workers.

“It’s time for Uber and Lyft to own up to their responsibilities and the people who make them successful: their workers,” Becerra stated in a declaration. “Misclassifying your workers as ‘consultants’ or ‘independent contractors’ simply means you want your workers or taxpayers to foot the bill for obligations you have as an employer… That’s not the way to do business in California.”

The argument over gig employee advantages has actually raved for several years. Several claims have actually been submitted versus Uber, Lyft and other gig economy business dating as far back as 2013. But now, as the unique coronavirus pandemic has actually shaken society, that argument has actually been enhanced.

Currently, most employees for gig economy business, like Uber, Lyft, Instacart, Postmates and DoorDash, are categorized as independent specialists. That suggests those employees spend for their own cars and truck, phone, gas and lorry upkeep. They likewise aren’t offered fundamental labor advantages, such as base pay warranties, overtime pay, medical insurance and authorized leave.

Under AB 5, which entered into impact in California on Jan. 1, business that utilize independent specialists might be needed to transform their employees into workers. 

California was the very first state to pass a law clearly around gig employees. But other states have actually started to do the same. Washington, Oregon, New York and New Jersey are now thinking about legislation comparable to AB 5.

The business have actually actively battled versus AB 5 considering that prior to the law even passed last fall. Both Uber and Lyft are having a hard time to end up being lucrative, and labor expenses might include countless dollars to their bottom lines. 

The 2 ride-hailing business belong to a union of gig economy business sponsoring a November tally effort focused on making them exempt from AB 5. In all, $110 million has actually been raised to support the step, called the “Protect App-Based Drivers and Services Act,” and Uber and Lyft stated they’ll invest more on the project if requirement be. The step will formally be contributed to California’s tally on Thursday.


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“We believe the courts should let the voters decide,” a Lyft spokeswoman said. In regard to the preliminary injunction, she said, “It would be incredibly harmful to millions of people and the California economy to grant this motion 100 days before the voters decide, and we will oppose this motion.”

Uber has warned that if forced to make its drivers employees, 76% of them could lose their work on the ride-hailing platform. The company says this is because prices could rise and then less people would use Uber for rides.

“The vast majority of drivers want to work independently, and we’ve already made significant changes to our app to ensure that remains the case under California law,” an Uber spokesman said. “When over 3 million Californians are without a job, our elected leaders should be focused on creating work, not trying to shut down an entire industry.”

While many drivers say they prefer to remain independent contractors, thousands of others have widely supported AB 5. On Wednesday, a caravan of about 50 drivers protested in front of Uber CEO Dara Khosrowshahi’s house in San Francisco, demanding the company drop the November ballot measure.

“Minimum wage laws and other labor protections were created to make sure that even people in poverty can have the ability to exist in dignity and earn the fair value of their work,” Edan Alva, an Uber driver and organizer, said during the protest. “Drivers are not allowed to go into the Uber CEO’s office and take his money away, why should gig companies be allowed to rob the value of our work?”

If the judge grants Becerra’s preliminary injunction, Uber and Lyft would be forced to comply with AB 5. Becerra filed the injunction request on Thursday and a hearing date is scheduled for Aug. 6.

“Drivers are employees under California law, and there’s no reason they should be denied basic workplace benefits,” San Francisco City Attorney Dennis Herrera said in a statement. “Despite a campaign of misinformation, nothing prevents Uber and Lyft from properly classifying drivers and giving them flexibility.”



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