This should have been done the day that the law went into effect.
The so-called sharing economy business model has been about regulatory and labor arbitrage in order to make the rest of us pay the cost that they inflict on the rest of us:
California's attorney general—as well as attorneys from three of the state's largest cities—have sued Uber and Lyft, accusing the companies of violating the labor rights of thousands of drivers. The plaintiffs argue that state law requires Uber and Lyft to treat their drivers as employees, which would make them eligible for minimum wage protections, overtime pay, expense reimbursements, and other benefits they don't currently receive.These companies are a threat to public safety, and they make their money off of the misery of their "independent contractors."
A lawsuit from the state of California is a totally different scenario. Attorney General Xavier Becerra and the city attorneys of San Francisco, Los Angeles, and San Diego have enough combined legal resources for a fair fight against the ride-hailing giants. And if Uber and Lyft lose, they could not only owe hundreds of millions of dollars in back wages and other costs, they could also be forced to fundamentally rethink how they do business in the most populous US state.
"Californians who drive for Uber and Lyft lack basic worker protections—from paid sick leave to the right to overtime pay," Becerra said in a Tuesday statement. "California has ground rules with rights and protections for workers and their employers. We intend to make sure that Uber and Lyft play by the rules."
Last year, California's legislature passed landmark legislation that sets a high bar for companies to classify workers as independent contractors rather than employees. Under the so-called "ABC test," an employer wanting to exclude a worker from employee status must show that the worker meets three criteria:
To win, Uber and Lyft must prevail on all three of these questions. The companies must show that they don't control the drivers and that drivers' work isn't core to their business and that drivers are engaged in an independent trade.
- The person is free from the control and direction of the hiring entity in connection with the performance of the work...
- The person performs work that is outside the usual course of the hiring entity's business.
- The person is customarily engaged in an independently established trade, occupation, or business.
Here is hoping that this goes to a jury, and the award is massive.