The Northern District of California partially granted a motion to dismiss a class action lawsuit alleging Uber Technologies Inc. violated the California Labor Code by misclassifying its delivery drivers as independent contractors on Monday.
The lawsuit was filed by Northern California resident Kent Hassell in June 2020. He claimed that Uber unlawfully required its drivers to pay business expenses and failed to pay them minimum wage and overtime or provide them with itemized wage statements and sick leave as required by California law. According to Hassell, California Assembly Bill 5 prevents employers from classifying workers who perform services within their usual course of business as independent contractors.
“It has been widely recognized by the California legislature, including the bill’s author, that the purpose and intent of this statute is to ensure that companies, including specifically Uber, stop misclassifying their workers as independent contractors,” the suit stated. “Although Uber attempted to obtain a ‘carve-out’ from this statute, it did not obtain such an exemption, and the legislature passed the statute so that it would include Uber Eats drivers. Nevertheless, Uber Eats has defied this statute and continued to classify its delivery drivers as independent contractors – in violation of the clear intent of the California legislature.”
The initial suit was dismissed in December 2020, and the plaintiffs submitted an amended complaint in January of this year. Uber seeks to dismiss the case again on the grounds that California Proposition 22 repealed California Assembly Bill 5 when it passed last November.
“The (first amended complaint) continues to rest on the fundamental assertion that Hassell was properly considered Uber’s ‘employee,’ despite the fact that under Proposition 22, ‘an app-based driver is an independent contractor and not an employee or agent,’” the defendant stated in court documents.
The court denied in part and granted in part Uber’s motion to dismiss, arguing that neither side was persuasive.
“The court finds that the arguments and evidence proffered by both sides on this issue does not permit it to make a conclusive determination on whether Business & Professions Code § 7451 abates the authority underlying plaintiff’s misclassification allegation and, thus, his claims. Given that, the court denies the defendant’s motion to the extent it is premised on abatement.”
Uber has previously been sued in Florida, California and Massachusetts for mislabeling Uber drivers as independent contractors instead of as employees. The California Labor Commissioner’s Office is also currently involved in a legal dispute with the company.