California

Uber says it won’t reclassify its drivers despite passage of new California labor rules

Watch Lyft and Uber drivers swarm to Capitol to support bill

Drivers from Uber and Lyft converged on the Capitol from across California to support Assembly Bill 5, which would force ‘gig economy’ employers to treat independent contractors as employees, on Wednesday, Aug. 28, 2019.
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Drivers from Uber and Lyft converged on the Capitol from across California to support Assembly Bill 5, which would force ‘gig economy’ employers to treat independent contractors as employees, on Wednesday, Aug. 28, 2019.

Uber’s chief legal officer says the ride-share company doesn’t plan to reclassify its drivers as employees, even though California lawmakers just passed a bill they say will force the company to do just that.

California’s Legislature on Wednesday approved a high-profile bill that they say will force companies to reclassify many workers as employees instead of independent contractors, meaning they’ll be entitled to benefits like minimum wage and compensation for injuries sustained on the job.

Immediately after the bill’s passage, Uber’s chief legal officer Tony West said the company won’t concede that drivers must now become employees. West said its drivers are legitimately classified as independent contractors under the law because the work they perform is outside the scope of its usual business, which it argues is simply a technology platform.

“Just because the test is hard doesn’t mean that we won’t be able to pass it,” he told reporters on a call Wednesday afternoon.

Despite the confidence West expressed on the call, Uber and other so-called gig economy companies had previously argued that they should be exempt from the new test and have threatened to spend tens of millions of dollars to launch a ballot measure that would let their workers continue operating as independent contractors.

He says they’ll continue to treat them as independent contractors and are prepared to fight in court to defend that position to avoid damage to its business model.

“If we go through a process where these cases are litigated… and we lost and drivers then become employees, then there would be costs that go along with that,” West said.

Gov. Gavin Newsom has said he supports the bill, indicating he’ll likely sign it into law.

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