Judge grants preliminary injunction requiring Uber and Lyft to stop classifying drivers as contractors

Dara Khosrowshahi, chief government officer of Uber Applied sciences Inc., speaks throughout an interview in Tokyo, Japan, on Wednesday, July 3, 2019.

Akio | Bloomberg | Getty Photos

A California choose granted a preliminary injunction Monday requiring Uber and Lyft to cease classifying their drivers as impartial contractors pending additional motion by the court docket. The order will take impact after 10 days, as the businesses requested a quick keep in the course of the appellate evaluate course of.

California Legal professional Basic Xavier Becerra requested the injunction as a part of a lawsuit he brought in May together with metropolis attorneys from San Francisco, Los Angeles and San Diego. The swimsuit, filed in San Francisco Superior Court docket, alleged Uber and Lyft violated the state’s new legislation generally known as Assembly Bill 5 (AB5), which was created as a strategy to classify gig employees as full staff and guarantee advantages from their employers. Uber and Lyft had been amongst a bunch of tech firms which have beforehand opposed the invoice, arguing their employees benefit from the flexibility of making their very own schedules as contractors. 

California officers sought an injunction on the alleged misclassification and restitution for employees and civil penalties price as much as a whole lot of thousands and thousands of {dollars}.

Uber CEO Dara Khosrowshahi advocated for a “third approach” to categorise employees in a letter to President Donald Trump in March as the primary spherical of coronavirus reduction measures had been being negotiated. He argued there needs to be a approach for employees to realize protections with out sacrificing the flexibleness of contract work.

Within the ruling, Choose Ethan Schulman acknowledged the worth of flexibility supplied by Uber and Lyft, writing, “The Court docket doesn’t take evenly Defendants’ displaying {that a} preliminary injunction may additionally have an adversarial impact on a few of their drivers, lots of whom want the flexibleness to proceed working as they’ve up to now, and will have commitments that make it troublesome if not unimaginable for them to turn into full-time staff.”

However Schulman wrote that Uber and Lyft’s considerations that the injunction would have “far-reaching results” had “solely been exacerbated by Defendants’ extended and brazen refusal to adjust to California legislation. Defendants could not evade legislative mandates merely as a result of their companies are so giant that they have an effect on the lives of many 1000’s of individuals.”

The ruling doesn’t finish the authorized battles for Uber and Lyft, nonetheless. Final week, California’s Labor Commissioner announced lawsuits towards the businesses alleging wage theft because of misclassification. The fee seeks to get better wages it believes had been owed to drivers presently labeled as contractors. The fits had been filed in Alameda County Superior Court docket.

This story is growing. Verify again for updates.

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PJ is the Digital Marketer & Founder of PJ Digital Marketing, has involved in this field from 2010 onwards. Also the owner of a few more sites in different fields.