The California appeals court found that a labour measure, known as Proposition 22, was largely constitutional.
Labour groups and some workers had opposed the measure, saying it robbed them of rights like sick leave.
The firms say the proposition protects other benefits such as flexibility.
The latest ruling overturns a decision made by a lower court in California in 2021, which found that Proposition 22 affected lawmakers' powers to set standards at the workplace.
The state of California and a group representing Uber, Lyft and other firms appealed against the decision.
On Monday, a three-judge panel at the appeals court ruled that workers could be treated as independent contractors. However it removed a clause, which put restrictions on collective bargaining by workers, from Proposition 22.
Shares in Uber and Lyft were almost 5% higher in after-hours trading.
"Today's ruling is a victory for app-based workers and millions of Californians who voted for Prop 22," Tony West, chief legal officer at Uber said.
[...] Tens of millions of people work in the global gig economy across services like food delivery and transport.
Gig workers are paid for individual tasks, such as a food delivery or a car journey, rather than getting a regular wage.
Most US federal and state labour laws, such as those requiring a minimum wage or overtime pay, do not apply to gig workers.
Previously:
NYC Court Blocks Pay Raise for Uber and Lyft Drivers
Uber, Lyft Drivers In California To Remain Independent Contractors
California Appeals Court Says Uber, Lyft Drivers are Employees, Not Contractors
California Judge Rules Uber and Lyft to Immediately Classify Drivers as Employees
California Sues Uber and Lyft, Alleging Drivers are Misclassified
Uber, Lyft Poised to Lose Fight Against California Bill That Would Label Drivers as Employees
Related Stories
California Democrats are poised to pass landmark employment legislation over the objections of two of the companies that would be most affected: Silicon Valley ride-sharing giants Uber Technologies Inc. and Lyft Inc.
The bill already passed the State Assembly 59-15 and is expected to be voted on in the state Senate before the legislative session ends on Friday, possibly as soon as Monday night. Democratic Gov. Gavin Newsom has said he would sign the bill, which intends to force companies that rely on “gig workers” to reclassify them as employees, likely upending the business model of those companies.
Uber and Lyft have spent much of the year pushing lawmakers to alter the bill or exempt them. That effort has failed against opposition from labor unions and a large Democratic majority in Sacramento. The companies have argued the bill would introduce new costs and logistical challenges that would be bad for them and many of their employees, who prefer job flexibility. If the measure becomes law, it is expected to have national repercussions given California’s economic importance and history of creating precedent-setting business regulations.
Arthur T Knackerbracket has found the following story:
The state of California is suing Uber and Lyft. Attorney General Xavier Becerra filed a lawsuit against the two ride-hailing companies on Tuesday alleging they've "exploited hundreds of thousands of California workers" by classifying their drivers as independent contractors rather than employees.
[...] The lawsuit alleges Uber and Lyft violated a California state law called AB 5, which aims to ensure workers have adequate labor protections by classifying them as employees. The suit was filed in San Francisco County Superior Court by the Attorney General's Office in conjunction with the city attorneys from San Francisco, Los Angeles and San Diego.
[...] Gig workers are considered essential workers, meaning they can continue to work as the virus spreads. Because they're still out there, delivering food to people in quarantine and transporting medical workers to and from hospitals, they can be more at risk of contracting COVID-19. Thousands of Uber and Lyft drivers have been infected with or exposed to the coronavirus, according to the companies, and at least five drivers have died from the disease.
California Judge Rules Uber and Lyft to Immediately Classify Drivers as Employees:
A California court issued a preliminary injuction on Monday, ordering Uber and Lyft to immediately reclassify Uber and Lyft ride-share drivers as employees, in a highly anticipated decision that follows a months-long battle between the state of California and the gig economy companies.
The San Francisco Superior Court judge said the companies must begin complying within 10 days.
In May, California's attorney general Xavier Becerra, alongside the cities of San Francisco, Los Angeles, and San Diego, sued Uber and Lyft, arguing that the companies have been violating law by misclassifying Uber and Lyft drivers as independent contractors since January 1 when a state law known as AB5 went into effect.
In June, Becerra filed a request for a preliminary injunction, arguing that drivers are currently enduring such significant damages that waiting until the end of litigation would cause irreparable harm.
Responding to news of the preliminary injunction, attorney general Becerra said, "The court has weighed in and agreed: Uber and Lyft need to put a stop to unlawful misclassification of their drivers while our litigation continues. While this fight still has a long way to go, we're pushing ahead to make sure the people of California get the workplace protections they deserve."
California appeals court says Uber, Lyft drivers are employees, not contractors:
A California appeals court on Thursday upheld a state order requiring Uber and Lyft to treat their California drivers as employees instead of independent contractors. The ruling comes less than two weeks before California voters will be asked to exempt the ride-hailing giants from the state's ground-breaking gig economy law.
The decision won't have any immediate impact because it doesn't take effect for at least 30 days, well after the November 3 vote on Proposition 22.
Uber and Lyft had appealed an August preliminary injunction by a San Francisco judge. But the appellate ruling found "no legal error" and allowed it to stand.
"We conclude that the injunction was properly issued in accordance with enduring principles of equity," the 74-page ruling said. "It is broad in scope, no doubt, but so too is the scale of the alleged violations."
Uber and Lyft issued statements noting that the ruling doesn't take immediate affect(sic) and urging voters to approve Prop. 22. Lyft also said it is considering appealing to the California Supreme Court.
California Attorney General Xavier Becerra and the city attorneys of Los Angeles, San Diego and San Francisco had sued Uber under a new California law that says companies can only classify workers as contractors if they perform work "outside the usual course" of their business. Becerra praised the court's decision.
California voters decided on Tuesday to keep Uber, Lyft and other app-based ride-hailing and delivery service drivers classified as independent contractors. Coverage from Associated Press and Forbes.
Uber, Lyft and other app-based ride-hailing and delivery services spent $200 million in a winning bet to circumvent California lawmakers and the courts to preserve their business model by keeping drivers from becoming employees eligible for benefits and job protections.
The titans of the so-called gig economy bankrolled the most expensive ballot measure in state history, which was decided Tuesday with 58% of more than 11 million voters choosing to keep drivers classified as independent contractors able to set their own hours.
Shares of both companies surged 11% to 13% before the opening bell Wednesday after the huge victory.
The outcome was a defeat for labor unions that had pushed for a state law aimed directly at Uber and Lyft, mandating they provide drivers with protections like minimum wage, overtime, health insurance and reimbursement for expenses.
Uber sued the city's Taxi and Limousine Commission over the rate hike last month:
A court has blocked a rate hike that would have increased pay for New York City Uber and Lyft drivers. Uber sued the city's Taxi & Limousine Commission (TLC) in December, claiming it used a flawed methodology to determine the per-minute and per-mile rate increases. Manhattan state court Justice Arthur Engoron agreed. "It's just not enough to say there's inflation and 100 drivers said gas prices shot up," Engoron, a former taxi driver in his college days, said, according to Bloomberg.
In November, the TLC unanimously approved the city's first metered fare increases in a decade, including for ridesharing trips. Per-minute rates were slated to go up by 7.4 percent and per-mile rates by 24 percent. Under those planned hikes, a trip of 7.5 miles that took 30 minutes would have earned a ridesharing driver at least $27.15, an increase of more than $2.50 compared with current rates.
Uber argued that the rate increases would result in higher fares for customers while harming its reputation. A judge granted a temporary restraining order to pause the rate hikes a few days after Uber filed suit and before they came into effect on December 19th.
"Drivers do critical work and deserve to be paid fairly, but rates should be calculated in a way that is transparent, consistent and predictable," Uber spokesperson Josh Gold told Bloomberg. "Existing TLC rules continue to provide for an annual review tied to the rate of inflation, which will take place in March."
(Score: 3, Insightful) by Anonymous Coward on Thursday March 16 2023, @02:14AM (2 children)
I was a contract driver before people were even on AOL, let alone using apps. I did delivery for a local courier company. Just like Uber/Lyft, we were quasi-independent and there were downsides but there was an upside: You paid almost no tax if you took the mileage deduction, and if you were honest and paid for it you got quarters for Social Security.
A lot of shady people and even illegal immigrants are attracted to that business though, and even people who will just flat out not pay their taxes. It won't hurt you much if you do it for very long, but not paying in for benefits can really bite you in the ass.
Years later I met a dude in his 40s who had NO QUARTERS FOR SOCIAL SECURITY because of this whole "working outside the system" thing. He might still be able to make up some of that, as I think they only take the top N for calculating benefits. I forget what N is, It's still at least 10 years away for me to care.
Sucky jobs in general. Huge motivation to get back to school. If you can find a way out, do; but if you can't, for the love of god pay that SE tax. I know people who are collecting benefits now who used to say, "I'll never get SSI".
(Score: 0) by Anonymous Coward on Thursday March 16 2023, @03:23AM
Yeah. Only the good die young, and all that. Apparently, I wasn't one of the good ones.
(Score: 1) by khallow on Thursday March 16 2023, @05:22AM
So what? It goes down and there's fewer and fewer people supporting those Social Security payouts every year.
Or put it into a real investment.
(Score: 3, Informative) by Runaway1956 on Thursday March 16 2023, @03:32AM
And how does that affect the truck driving industry in California? The rulings against the gig workers were supposed to apply directly to truck drivers. https://www.mercurynews.com/2022/07/08/california-throws-70000-truckers-in-gig-work-legal-limbo-risking-supply-chains/ [mercurynews.com]
https://apnews.com/article/california-courts-economy-business-government-and-politics-332e244b793604ba65946a3f3b99e271 [apnews.com]
(Score: 2, Interesting) by Anonymous Coward on Thursday March 16 2023, @10:39AM (2 children)
Every time I’ve taken an Uber or Lyft, the driver has two smartphones, and they were talking rides from both at the same time. I’ve never heard of an employee who could legitimately do work from some other job while on the clock for his first job. It seems to me that exclusivity is a prerequisite for being an employer.
I suppose you could consider it an employee situation if they “punched in” only while they were actually driving a customer, but that would make them very part-time workers who wouldn’t be eligible for benefits anyway.
(Score: 0) by Anonymous Coward on Thursday March 16 2023, @09:06PM
Nobody has ever worked a side hustle at work before Lyft, nope. Never happened.
Uber and lyft are not employers in the same way that SN isn't a social media website. I can't begin to correctly insult your intelligence in the limited space provided.
So instead, some free advice: take a good look at how much you've internalized the "temporarily embarassed millionaire" nonsense.
(Score: 2, Interesting) by Runaway1956 on Friday March 17 2023, @01:09AM
Part time jobs. Hell, I worked a part time job for some months while in the Navy. I asked for, and got permission to do so from my commanding officer. The part time job had some limited benefits. Very limited for part timers, but if there were an accident on the job, it wouldn't leave Uncle Sam on the hook for injuries to an active duty serviceman.
Neither Uber nor Lyft can make any claims to full time employment, so exclusivity goes out the window.