California sues Uber and Lyft for driver back wages and benefits — for the second time
The California state labor commissioner added on Wednesday two new lawsuits to the growing stack of state filings against Uber and Lyft, alleging that their drivers have long been mislabeled as independent contractors and denied fair wages and benefits by the ride-hailing companies.
The separate lawsuits, filed in Alameda County Superior Court, allege both companies made a “calculated business decision” to “misclassify” drivers as independent workers, not employees, and therefore needed to pay out owed benefits and compensation.
It follows a separate lawsuit Attorney General Xavier Becerra filed in May seeking to force Uber and Lyft to pay millions in back wages under a new labor law that requires companies to provide employment benefits to more workers rather than labeling them as independent contractors.
“The Uber and Lyft business model rests on the misclassification of drivers as independent contractors,” said California Labor Commissioner Lilia García-Brower in a statement. “This leaves workers without protections such as paid sick leave and reimbursement of drivers’ expenses, as well as overtime and minimum wages.”
The lawsuits seek minimum wage back pay, overtime, rest and paid sick leave compensation and reimbursements for “necessary business expenses.”
Wednesday’s press announcement said the money would be sent to “all of Uber’s and Lyft’s drivers, including the nearly 5,000 drivers who have filed claims for owed wages.”
Since Gov. Gavin Newsom signed the law known as Assembly Bill 5, gig economy companies have sued to block it.
Uber, Lyft and DoorDash are also behind a November ballot measure called Proposition 22 that would keep drivers as independent contractors but with benefits like overtime pay, unemployment insurance and workers’ compensation.
“The vast majority of California drivers want to work independently, and we’ve already made significant changes to our app to ensure that remains the case under state law,” said Uber spokesman Davis White. “When 3 million Californians are without a job, our leaders should be focused on creating work, not trying to shut down an entire industry.”
“The state labor agency has botched thousands of claims,” Lyft spokeswoman Julie Wood added. “They know they don’t have the ability to process these claims, so they sent them into a legal abyss, where they know it will take years to resolve them.”
The Transport Workers Union of America and high-profile labor organizations like the California Labor Federation and SEIU California are working against the ballot measure, arguing the effort to take the issue to the voters in November is an attempt to deny workers protections under the new law.
“Labor Commissioner Garcia-Brower is standing up for workers and holding these companies accountable,” said John Samuelsen, president of the Transport Workers Union. “For years Uber and Lyft have been stealing wages and exploiting every legal loophole they can to avoid paying drivers what they deserve. It was shameful before and it is even more shameful now, during the middle of a pandemic, that we have allowed wealthy companies to get away with this. This lawsuit is an essential part of holding these companies accountable and protecting drivers’ rights.”
This story was originally published August 5, 2020 at 2:15 PM with the headline "California sues Uber and Lyft for driver back wages and benefits — for the second time."