Uber lost an effort to overturn a 2020 California law that compels businesses to offer employment benefits to more workers rather than treating them like independent contractors.
Lorena Gonzalez, chief officer of the California Labor Federation and the former state lawmaker who authored AB 5, said Monday, June 10 that a ruling by the 9th U.S. Circuit Court of Appeals was “a victory for all workers in the state, but especially the chronically misclassified workers in rideshare and delivery jobs.
” Uber lost its long-running attempt to overturn a California law that would require it to provide employment rights to its drivers and delivery workers. The ruling on Monday, June 10 by the 9th U.S. Circuit Court of Appeals could have major implications — depending what the state Supreme Court decides in a separate but related case.AB 5 requires ride-hailing and delivery companies to treat their workers as employees instead of independent contractors and codifies the so-called ABC test to determine which workers should receive benefits. Under the law, other gig companies are subject to a different test, which Uber and Postmates claimed was unfair. The companies sued and sought an injunction against the law that took effect at the beginning of 2020. Last year, a three-judge panel at the 9th Circuit sided with Uber and revived the case, which had been previously dismissed by a federal judge.today, Judge Jacqueline Nguyen said there are “plausible reasons” for treating Uber differently from other types of companies that use gig workers, such as Wag, a platform that connects dog owners and dog walkers, because the Legislature “perceived transportation and delivery companies as the most significant perpetrators of the problem it sought to address — worker misclassification.” More than 1.4 million workers in California do app-based driving and delivery work for big gig companies such as Uber, Lyft, DoorDash and Instacart, according to the industry’s latest estimates. Lorena Gonzalez, chief officer of the California Labor Federation and the former state lawmaker who authored AB 5, said in a statement today: “This is a victory for all workers in the state, but especially the chronically misclassified workers in rideshare and delivery jobs. Now, we must continue to seek ways to enforce this law.” The ruling means “the Legislature can continue to make laws that impact companies differently if the decision to do so is rational, without being concerned that such laws would violate the constitutional rights of the corporation,” said Veena Dubal, a UC Irvine law professor whose research centers on labor and inequality. “This is particularly important because so many sectors are now concentrated by two or three large companies.”in a case challenging the constitutionality of Proposition 22, the initiative the gig industry put on the ballot in 2020, and which a majority of California voters approved. Prop. 22 exempted Uber and other companies such as Lyft, DoorDash and Instacart from AB 5, allowing them to continue to treat their workers as independent contractors while giving them some new benefits they did not have before, such as guaranteed minimum earnings.out of the about $200 million the gig industry put into the campaign. It contends AB 5 threatens the “flexible work opportunities” that many Californians want.Theane Evangelis, a lawyer for Uber, in an emailed statement today reiterated the company’s position that “with AB 5 the Legislature unfairly targeted my clients out of animus rather than reason.” Uber had argued that AB 5 has many exemptions for companies that pay workers in different industries. They include live performers, music professionals, real estate appraisers and more. But William Gould, professor emeritus at Stanford Law School and a former chairman of the National Labor Relations Board, called the opinion “eminently sensible.” Gould said the court “correctly holds that Uber and others may be covered where the Legislature deems them to be disproportionately responsible for inequality in the gig economy.” If Prop. 22 is upheld, it would be a huge victory for Uber and the other big gig companies, but today’s ruling means they would still be on the hook in any cases where they are found to have violated laws related to worker classification before Prop. 22 took effect. In the appeals court decision, Nguyen referred to “ongoing state enforcement actions seeking retrospective relief, including civil penalties,” against Uber and Postmates. If Prop. 22 is thrown out, the appeals court ruling means “these companies do not have this case to fall back on to exempt themselves from having to provide basic employment protections,” Dubal said. The state Supreme Court files its written opinion within 90 days of oral argument, so its decision could come by the end of August.Miss Manners: I'm a bride-to-be with a flashy ring, and I don't like the questions I getAsk Amy: Our wedding was happy. Since then, things have gone downhill fast.Ask Amy: I needed my friend's help, and all she offered was prayersDear Abby: I thought I was like a second mom -- then they put me on the B-listNot in my backyard: Illegal California ADUs outpacing permitted ones Massachusetts middle schooler banned from wearing ‘only two genders’ shirt loses federal appeals case
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