Uber has been hit with a proposed class action lawsuit in California over its alleged misclassification of drivers as independent contractors. The filing of the 15-page case comes as a new proposed California law stemming from a state Supreme Court decision in Dynamex Operations W., Inc. v. Superior Court awaits Governor Gavin Newsom’s approval.
The complaint claims that Uber’s misclassification of its drivers as independent contractors rather than bona fide employees has unlawfully left the workers on the hook for all manner of business expenses ranging from vehicle maintenance, gas and insurance to phone and data usage. Moreover, Uber, the case says, has failed to guarantee drivers at least minimum wage for every hour worked, notwithstanding time-and-a-half overtime pay for each hour worked in excess of 40 per week. Further still, Uber has allegedly failed to offer up properly itemized wage statements complete with the number of weekly hours a driver has worked and the individual’s hourly wage rate.
According to the plaintiff, Uber’s willful driver misclassification violates the California labor code.
At the heart of the lawsuit is the California legislature’s passage of Assembly Bill 5 (AB5), known colloquially as the Dynamex Law. The bill, which awaits either approval or a veto from Governor Newsom, codifies a 2018 state Supreme Court ruling under which an employer “cannot justify classifying workers as independent contractors who perform services within its usual course of business.” Uber, the complaint states, attempted to obtain a “carve out,” or exemption, from the Dynamex bill but failed to do so. The lawsuit points out that the ride-hailing company has publicly stated that it intends to ignore the California law, which would go into effect in 2020, and continue to consider its drivers as independent contractors.
Under the Dynamex Law, California employers in non-exempt industries would be subject to a three-prong legal started, dubbed an ABC test, should they wish to classify their workers as independent contractors. To pass an ABC test and be allowed to classify its workers as independent contractors, an employer would have to prove that its workers are free from company control, perform work “outside the usual business,” and are regularly engaged in a trade apart from their work for the company.
Per the case, Uber drivers on the clock for the company “are not engaged in their own transportation business.” This much is evidenced by the fact that customers cannot request rides from specific Uber drivers, nor can drivers pick particular rides outside of those assigned by Uber. Ultimately, the suit argues, Uber controls the far majority of drivers’ working lives, from vehicle standards to background checks and training to adverse action related to on-the-job conduct.
The plaintiff, who the suit states has worked as an Uber driver since November 2016, charges Uber cannot pass the Dynamex ABC test, and has chosen instead to willfully violate California law. From the complaint:
“On April 30, 2018, the California Supreme Court issued its decision in Dynamex Operations W., Inc. v. Superior Court, 4 Cal. 5th 903, 416 P.3d 1 (2018), reh’g denied (June 20, 2018), which makes clear that Uber drivers should be classified as employees rather than as independent contractors under California law for purposes of wage-and-hour statutes like the ones at issue here. Under the ‘ABC’ test adopted in Dynamex, in order to justify classifying the drivers as independent contractors, Uber would have to prove that its drivers perform services outside its usual course of business (in addition to other requirements), which it cannot do. Notwithstanding this decision, Uber has willfully continued to misclassify its drivers as independent contractors.”