Uber faces suit after vow to disobey new gig workers law

As Assembly Bill 5's passing in the Legislature signals a possible sea change in how millions of California gig economy workers are classified, a Boston attorney filed a class action against Uber Technologies Inc. after the ride-hailing company vowed to keep its drivers categorized as independent contractors.

Shannon Liss-Riordan of Lichten & Liss-Riordan PC filed the complaint late Wednesday in the Northern District of California just hours after the bill passed a final concurrent vote in the Assembly. The suit alleges Uber misclassifies its drivers as independent contractors, including named plaintiff Angela McRay, under California law.

As a result, Uber has failed to pay its drivers a minimum wage, cover overtime premiums or provide itemized wage statements, the suit alleges. Uber also passes business expenses employers would normally pay onto its drivers, the suit alleges. McRay v. Uber Technologies Inc., 10-CV05723 (N.D. Cal, filed Sept. 11, 2019).

The suit went so far as to cite AB 5 passing in the Legislature, Gov. Gavin Newsom's expected signature and comments Uber chief legal officer Tony West made Wednesday reiterating the company's stance on classification.

Calls to Uber were not answered Friday. In a previous statement, West said the San Francisco-based company would "continue to respond to claims of misclassification in arbitration and in court as necessary, just as we do now."

Liss-Riordan made it clear the suit's timing was not a coincidence.

"I brought this action Wednesday night, after Uber General Counsel Tony West's statement that Uber will not reclassify its drivers even after AB 5 goes into effect, because Uber should not be above the law," she said in a statement. "Uber cannot avoid their responsibilities."

Liss-Riordian also referenced Wednesday decision in the 3rd U.S. Circuit Court of Appeals that Uber drivers qualify for an exemption from the Federal Arbitration Act, reversing a lower-court decision. If upheld, the decision would give drivers a way around Uber's arbitration clause to sue for misclassification. Singh v. Uber Technologies Inc., 17-1397 (3rd Cir., filed Sept. 11, 2019).

According to the suit, the plaintiff seeks class certification, compensatory damages, attorney fees and costs, an order requiring Uber to comply with AB 5, the California Labor Code and other provisions, and injunctive relief.

Currently awaiting Newsom's signature in the next few weeks, AB 5 codifies the employee-presumptive, three-prong "ABC" test to exempt independent contractors. The test comes following the 2018 decision in Dynamex Operations West, Inc. v. Superior Court.