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Uber sues California to block gig-worker law going into effect this week:
Ride-hailing service Uber filed a lawsuit Monday against the state of California, alleging a landmark gig-worker law set to go into effect is unconstitutional. The lawsuit seeks to block AB 5, which has the potential to upend gig economy companies such as Uber and Lyft.
The complaint, which also lists Postmates as a plaintiff, argues that the law unfairly targets workers and companies in the on-demand economy, treating them differently than traditional employees and threatening their flexibility.
In September, California became the first state to pass a law aimed at protecting gig worker rights, which forces Uber, Lyft, DoorDash, Postmates and other gig economy companies reclassify their workers as employees. Using independent contractors allows the companies to shift many costs to the workers.
The lawsuit says the law arbitrarily exempts dozens of occupations, including direct salespeople, travel agents, grant writers, commercial fishermen and construction truck drivers, among others.
"There is no rhyme or reason to these nonsensical exemptions, and some are so ill-defined or entirely undefined that it is impossible to discern what they include or exclude," says the complaint (see below), which was filed in a Los Angeles federal court.
Postmates and Uber v State of California on Scribd
(Score: 1, Interesting) by Anonymous Coward on Wednesday January 01 2020, @02:48PM
A lot of independent contractors are just doing it for pocket money and anything that can be done to stop them for working for less than the cost of providing the service is a step in the right direction. I see the same sort of thing in tutoring, where you've got people who are charging just over minimum wage, not paying taxes and training students to think that it's acceptable to pay such low wages. They'll then move on to something else and leave the students thinking they can get reasonable service without being willing to pay for it.
The independent contractor rules are an extension of business owners not being required to make enough money to live on. The rules in a sense make sense as it can take years to build a business up to the point where you're able to live on the income while investing in its growth. But, it also leaves open the possibility of illegally setting prices below the cost of providing the service by having a spouse covering living expenses and competing unfairly.
At this point, you've got companies that essentially don't hire regular employees, despite having more than enough money to do so. Rather than small businesses that are using independent contractors because they only need the service for a few hours a year.