Ethan Schulman, California Supreme Court Justice, has issued an injunction compelling Uber and Lyft to reclassify its drivers as employees. This order is expected to take effect in ten days.
“The court has no illusions that its injunction will be costly to implement,” Judge Schulman wrote in the order. “There is no question that in order to comply with AB 5, Defendants will have to make significant changes to the nature of their business practices, such as hiring staff to hire and manage their drivers.”
Given the order won’t go into effect for ten days, Uber plans to file an 911 call immediately, an Uber spokesman told TechCrunch.
“The vast majority of drivers want to work independently, and we̵
The decision comes after Judge Schulman heard arguments in court last week. The hearing was the result of California Attorney General Xavier Becerra, who, along with city attorneys from Los Angeles, San Diego, and San Francisco, filed an injunction to force Uber and Lyft to abide by AB 5 and immediately stop classifying their drivers as independent contractors .
“Drivers don’t want to be employees, period,” says a Lyft Spokesman said TechCrunch. “We will appeal this ruling immediately and continue to fight for their independence. Ultimately, we believe this issue will be decided by the California voters and that they will side with the drivers. “
In the order, Judge Schulman says plaintiffs are likely to enforce the argument that Uber and Lyft are violating AB 5. AB 5 codifies the 2018 decision made in Dynamex Operations West, Inc. v. Superior Court of Los Angeles. In this case, the court used the ABC test and ruled that Dynamex had wrongly classified its employees as independent contractors based on the assumption that “an employee who provides services to a tenant is an employee in terms of claims Wages and benefits is… ”.
According to the ABC test, in order for a hiring company to legally classify an employee as an independent contractor, it must demonstrate that (A) the employee is free from the hiring company’s control and direction, (B) is performing work outside of scope (C) regularly engaged in an “independently established trade, profession or business of the same type as the work performed”.
The interim hybrid motion was filed as part of the lawsuit filed in May alleging that Uber and Lyft obtained an unfair and unlawful competitive advantage by misrepresenting workers as independent contractors. According to the lawsuit, Uber and Lyft are depriving workers of the right to minimum wages, overtime, access to paid sick leave, disability and unemployment insurance. The lawsuit, filed in the San Francisco Supreme Court, has fines of $ 2,500 for each violation, possibly per driver, under California’s Unfair Competition Act, and an additional $ 2,500 for violations against the elderly or people with disabilities.
“For years, workers have been organizing and speaking out against our ill-treatment by billion-dollar gig companies who have refused to obey the law,” said Uber driver and Gig Workers Rising member Edan Alva in a statement. “Because of the fearlessness of the workers, the attorney general was able to argue that the abuse we are subjected to is so severe that the judiciary cannot wait any longer. Today the court was on the workers’ side, not the companies. Thousands of misclassified gig workers receive the wages, benefits, protections, and employee status owed to them by law. It’s perfectly clear that Uber and Lyft now have to comply with the law. We are steadfast in calling for gig companies to drop their $ 110 million Proposition 22 election initiative and reinvest those funds in treating their employees with dignity and respect. “