For those of you who are unaware of Uber’s and Lyft’s legal troubles, please take a moment to read Uber & Lyft: The Independent Contractor v. Employee Classification Saga Continues!; Uber and Lyft Will Continue to Operate in California (Temporarily)!; and The Uber and Lyft Saga Continues!.
On November 3, 2020, Californians made a decision on Proposition 22 – for those who are not familiar, Proposition 22 was a ballot measure that removed ride share and food delivery companies from the scope of AB5 and allowed them to treat their drivers as independent contractors. Unsurprisingly, it passed! Which is a big win for employers.
Nonetheless, Uber’s and Lyft’s legal trouble still remains, as Proposition 22 contains no language concerning whether it would apply retroactively and/or was clarifying existing law. Meaning, Uber and Lyft may still be liable for its misclassification of employees up and until the passing of Proposition 22. On the bright side though, due to the success of Proposition 22, more businesses or industries may choose to use the California ballot initiative process to further challenge and create exceptions to AB5. So, keep your eye out for further challenges to AB5 in the future.
Generally, lawsuits concerning the misclassification of an employee as an independent contractor are quite common in California, and as a result of AB5, and can lead to severe monetary penalties for employers. To learn more about AB5 and to ensure that your employees are properly classified, contact the Employment Lawyers at Chauvel & Glatt.
The material in this article, provided by Chauvel & Glatt, is designed to provide informative and current information as of the date of the post. It should not be considered, nor is it intended to constitute, legal advice or promise similar outcomes. For information on your particular circumstances, please contact Chauvel & Glatt at 650-573-9500. (photo credit: 123rf.com)