In another update to the AB5 independent contractor litigation, the California Labor Commissioner’s Office has recently filed lawsuits against transportation companies Uber and Lyft for committing wage theft by misclassifying employees as independent contractors.  The lawsuits allege that by misclassifying workers, Uber and Lyft failed to meet their obligations as employers as required by California law, including:

  • paying drivers at least minimum wage,
  • paying overtime,
  • providing paid rest periods,
  • reimbursing drivers for the cost of all equipment and supplies needed to perform their work and for work-related personal vehicle mileage

The Commissioner did not stop there. The lawsuits also claim that the ride-share companies neglected to provide paid sick leave, to provide accurate itemized wage deduction statements, to timely pay all wages owed during and upon separation of employment, and to provide notice of employment-related information required by law.

AB5

Assembly Bill 5 (AB5) and its corresponding worker classification test, codified as California Labor Code Section 2750.3, set the standard for determining whether workers should be classified as employees or independent contractors. This new test is called the ABC test.  Under the ABC test, a worker is presumed to be an employee unless the company proves that the worker:

    (A) Is free from the control and direction of the company in performing work, both practically and in the contractual agreement between the parties; and

    (B) Performs work that is outside the usual course of the company’s business; and

    (C) Is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the company.

Meeting this standard is difficult. If you have been employed by any company or employer, including Uber or Lyft, and believe you were improperly classified as an independent contractor, you may be able to bring a wage and hour lawsuit against your employer, or may be entitled to compensation from a class action suit.  California workers claiming misclassification can claim that they are employees and are entitled to make claims such as failure to reimburse necessary business expenses, failure to provide accurate and complete wage statements, failure to pay unemployment insurance tax, and failure to provide workers compensation insurance.

Financial compensation that a misclassified employee can seek against an employer include:

  • unpaid wages,
  • unpaid overtime,
  • unpaid meal and rest breaks,
  • penalties and interest

A knowledgeable attorney can explain your legal rights to you in further detail. The attorneys at Webb Law Group, APC have a record of success when dealing with employment law disputes. Contact us to speak to an experienced employment attorney.