Californian judge forces Uber and Lyft to classify drivers as employees
Judge Ethan Schulman of the Californian Superior Court has granted a preliminary injunction that forces Uber and Lyft to reclassify their drivers as employees instead of independent workers. The order is to go into effect in ten days. Uber and Lyft are raising hell and “will immediately appeal”.
A preliminary injunction is “an order prohibiting an action to preserve the status quo while the underlying court case is decided”. It was filed by the Attorney General of the State of California, Xavier Becerra, and city attorneys from LA, San Diego, and San Fransisco.
Failing the ABC test
They want the ride-hailing companies to immediately comply with the Californian AB 5 rule and the so-called ABC test.
In this, a ‘hiring entity’ can only “legally classify a worker as an independent contractor, after proving the worker is free from the control and direction of the hiring entity (A), the worker performs work outside the scope of the entity’s business (B), and is regularly engaged in an independently established trade, occupation, or business of the same nature as the work performed (C).”
Depriving of rights
The actual lawsuit filed by Becerra and colleagues in May in the Superior Court of San Franciso accuses Uber and Lyft of depriving their drivers of the right to a minimum wage, overtime premiums, paid sick leave, disability insurance, or unemployment insurance. The court might enforce fines of $2 500 for each violation per driver under the California Unfair Competition Law as a start.
The preliminary injunction comes in quite distasteful to Uber and Lift. “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 spokesperson said, according to tech news site TechCrunch.
Shut down an entire industry
“When over three million Californians are without a job, our elected leaders should be focused on creating work, not trying to shut down an entire industry during an economic depression,” he argued.
“Drivers do not want to be employees, full stop”, a Lyft spokesman told Techcrunch. “We’ll immediately appeal this ruling and continue to fight for their independence. Ultimately, we believe this issue will be decided by California voters and that they will side with drivers.”