Uber Eats is latest target of worker classification suit

Rideshare industry foe Shannon Liss-Riordan is continuing her crusade for a court order forcing certain companies that lawmakers and regulators say are openly defying state labor law to classify workers as full-fledged employees, this time in a purported class action against Uber Eats.

Liss-Riordan has filed other lawsuits against Uber and Lyft in federal court in San Francisco, one of which might be the first in the nation to get to trial on the issue of worker misclassification. She said she expects this complaint to proceed in similar fashion.

"We wanted to make sure there was a case out there covering the Uber Eats drives in particular," she said. "Their work has been particularly important and significant during the time of this pandemic."

The drivers accuse Uber of misclassifying them as independent contractors to avoid paying benefits such as minimum wage, overtime pay and sick leave. They say it's a willful violation of California's landmark labor law, Assembly Bill 5, which they argue is specifically targeted at the company.

"It has been widely recognized by the California Legislature, including the bill's author, that the purpose and intent of this statute was to ensure that companies, including specifically Uber, stop misclassifying their workers as independent contractors," Liss-Riordan wrote.

The lawsuit seeks to only represent drivers who have never signed arbitration contracts, overcoming Uber's preferred method of sidestepping class actions.

Kent Hassell, the named plaintiff in the case, started working for Uber Eats in January and opted out of arbitration, according to the complaint. Hassell v. Uber Technologies, Inc., 20-CV-04062 (N.D. Cal., filed June 18, 2020).

Liss-Riordan has tried to sue on behalf of those who agreed to arbitration before but has not succeeded.

In a separate lawsuit against Uber seeking emergency paid sick leave amid state-mandated stay-at-home orders, U.S. District Judge Edward Chen sent the class action to arbitration. He found the drivers are not exempt from their contracts as transportation workers engaged in interstate commerce.

Liss-Riordan has pressed the argument, which courts have split on, to invalidate Uber's arbitration agreements with the drivers. She claims the exception to the Federal Arbitration Act should apply because the drivers sometimes cross state lines while transporting passengers. U.S. District Judge Indira Talwani in Massachusetts agreed drivers are exempt because they take people to and from the airport, she noted.

But Chen reasoned the test is not whether individual drivers have crossed state lines but whether the class has. He said it has not. Capriole v. Uber Technologies, Inc., 20-CV-02211 (N.D. Cal., filed April 1, 2020).

U.S. District Judge Vince Chhabria reached the same conclusion in a similar lawsuit against Lyft, also filed by Liss-Riordan.

Both cases are on appeal to the 9th U.S. Circuit Court of Appeals.

Liss-Riordan said she's hopeful to get to trial soon in another case against Uber. This one, like the lawsuit against Uber Eats, seeks to represent drivers who opted out of all of Uber's arbitration agreements. James and Verhines v. Uber Technologies, Inc., 19-CV-06462 (N.D. Cal., filed Oct. 8, 2019).

The Massachussetts-based Lichten & Liss-Riordan partner said it's vital the drivers opted out of all of the contracts, because they often have provisions binding them to previous agreements even if they opt out of new versions.

Chen is scheduled to consider class certification on Oct. 29.

"Uber's sure done a great job at avoiding getting to the merits for a long time," she said.

Assemblywoman Lorena Gonzalez, D-San Diego, author of AB 5, emphasized in a statement that lawmakers and regulators will no longer tolerate companies that fail "to provide basic protections" for their workers.

"For too long we have allowed this corporation, and others that operate like it, to break the rules at the public's expense. Not anymore," she said.

Just this month, the California Public Utilities Commission confirmed its position that Uber and Lyft drivers are employees under AB 5. This came on the heels of California Attorney General Xavier Becerra suing Uber and Lyft in San Francisco Superior Court for allegedly misclassifying drivers in a first-of-its-kind lawsuit.

Unlike other lawsuits against rideshare companies derailed by arbitration agreements, Becerra's will not be constrained by those contracts.

San Francisco District Attorney Chesa Boudin also sued DoorDash on Tuesday, over the classifying of its workers as independent contractors.