Uber’s latest challenge to California’s freelancer law: a last-ditch lawsuit
Uber and Postmates have joined a federal lawsuit that aims to challenge the constitutionality of California’s Assembly Bill 5 (AB5) law, which goes into effect tomorrow, reports the Wall Street Journal. AB5 is the highly controversial law that targets gig-economy behemoths by making it more difficult for companies to classify their workers as independent contractors. If drivers work more than 15 hours a week, for example, companies must reclassify them as employees, which entitles them to minimum wages and other benefits.
The federal lawsuit Uber and Postmates have joined was filed by two drivers and, as the WSJ notes, argues that AB5 “violates constitutional guarantees of equal protection and due process because of how it targets some workers and companies.” AB5 doesn’t apply to certain kinds of white-collar work, though it does cover writers and photographers, some of whom have filed suit against the law.
The major gig-economy companies, like Uber, are taking several different approaches to thwarting the new rules. Back in October, Uber joined Lyft and DoorDash in pledging $90 million to fight AB5 in 2020. The companies are using the money to fund a ballot initiative for the November 2020 elections that would exempt ride-share companies from AB5 rules if those companies offer other benefits for contract workers, such as paying them “120 percent of the minimum wage.”
Even though AB5 goes into effect in less than 24 hours, it’s clear the fight over the bill is far from over.