Both Uber and Lyft face yet another complaint from the California Labor Commissioner’s office alleging abuse of pay. The cases filed today contend that both Uber and Lyft misclassify their drivers as independent contractors, and plan to implement AB 5’s fair standards.
“The corporate replica for Uber and Lyft relies on misclassifying drivers as independent contractors,” Lilia García-Brower, California Labor Commissioner, said in a statement. “This leaves employees without reimbursement including paid maternity leave and reimbursement of driver’s costs, as well as overtime and minimum wages.”
The goal of the various cases was to retrieve the money allegedly owing to those passengers. In classifying drivers as private workers rather than staff, both Uber and Lyft were not expected to provide minimum wage, reimbursement for overtime, nor were they forced to provide regular breaks or to compensate passengers for travel expenses.
AB 5, which went into effect earlier this year, specifies what type of job should be listed as an independent contractor and cannot. The Law codifies the Dynamex Operations West, Inc. v Los Angeles Superior Court ruling. The court applied the ABC test in that case and concluded that Dynamex unfairly graded its staff as an independent contractor.
“Uber and Lyft have stolen jobs for years and used whatever legal loophole they can to stop charging passengers what they deserve,” said John Samuelsen, president of the Transport Workers Union, in a statement. “It was shameful before, and now, amid a pandemic, it’s even more shameful that we’ve allowed rich corporations to get away with this. This case is an important part of keeping such companies responsible and preserving the interests of drivers.
Just months before Californians are set to vote on Prop 22, a ballot measure backed by Uber, Lyft, and others, these new lawsuits come in. The ballot measure aims to introduce a pay bonus of at least 120 percent of the minimum wage while at work, 30 cents a mile for costs, a hospital stipend, on-the-job disability workplace incident benefits, protection from sexism and sexual assault, and car crash and liability benefits. Yet most importantly, it will retain drivers registered as self-employed contractors.
According to the ABC rule, for a hiring entity to legitimately recognize a worker as an independent contractor, it must show that the worker is free of the hiring entity’s power and command, does employment beyond the entity’s field of operation and is routinely engaged in the employment of another separately defined trade or other similar company.