Updated: Feb 9
Today the AB5 bill in California passed, and is now waiting to be signed by Governor Newsom to become law. The Changes would take place for Uber and Lyft drivers January 1, 2020. However, Uber is planning for a legal fight instead of changing the status of their drivers.
Tony West, Uber's chief legal officer, told reporters today that they have no plans to reclassify drivers as employees should the Governor sign AB5 because, a driver's work is outside the usual course of Uber' s business. Which is severing as a technology platform for different marketplaces.
“The law does not say that drivers are employees,” West maintained. “What the law does is it changes the legal test to make the determination whether or not a driver is an employee or an independent contractor.”
West also said “We believe, given all the facts and circumstances we believe we can make the harder test, we can pass the harder test to the satisfaction of arbitrators and courts who hear the issue.”
In other words Uber has no plans to reclassify their drivers, and have a good reason to believe they won't have to for a very long time and to understand why you need to look at Massachusetts.
AB5 is based on a Massachusetts law that has been on the books for Uber and Lyft’s entire existence. Yet, Uber and Lyft drivers are independent contractors in Massachusetts just like everywhere else.
This is because workers have to sue and judges have to rule on the issue for that specific company before any changes can take place. Now yes both companies have been sued on this before. However, every case has been settled out of court and wasnnever ruled by a judge.
The Difference between Massachusetts law and California's is that with California city attorneys were granted the power to sue companies for worker misclassification. Which would allow lawsuits to happen faster, and allow the question of whether the issue ought to be settled in forced arbitration.
Whatever should happen West made it clear Uber will continue to classify drivers as independent contractors while also pursuing a ballot measure to let voters decide.