Connect with us

Hi, what are you looking for?

Capital Business
Capital Business
/FILE

World

California sues Uber, Lyft for driver wage theft

SAN FRANCISCO, United States, Aug 6 – California has filed lawsuits against Uber and Lyft for alleged wage theft by misclassifying their drivers as independent contractors rather than employees, the Labor Commissioner’s Office said Wednesday.

Classifying their drivers as independent contractors “has deprived these workers of a host of legal protections in violation of California labor law,” the office said in a statement.

Under a California law that came into effect on January 1, workers are considered employees unless they are free from the company’s control and perform work outside its usual line of business.

The law challenges the business model of the San Francisco-based rideshare platforms and others which depend on workers taking on “gigs” as independent contractors.

California’s lawsuits seek to recover amounts owed to all Uber and Lyft drivers, including nearly 5,000 drivers who have filed claims for owed wages, the Labor Commissioner’s Office said.

“The Uber and Lyft business model rests on the misclassification of drivers as independent contractors,” California labor commissioner Lilia García-Brower said.

“This leaves workers without protections such as paid sick leave and reimbursement of drivers’ expenses, as well as overtime and minimum wages.”

Uber and Lyft each have around 100,000 drivers, the Labor Commissioner’s Office said.

Uber has long argued it is merely a platform linking self-employed drivers with riders.

Advertisement. Scroll to continue reading.

“The vast majority of California drivers want to work independently, and we’ve already made significant changes to our app to ensure that remains the case under state law,” Uber spokesman Davis White said in a statement quoted by the Los Angeles Times.

“When 3 million Californians are without a job, our leaders should be focused on creating work, not trying to shut down an entire industry.”

Uber’s core ride-sharing operations have been hit hard by the global pandemic. The firm is due to announce its second-quarter results on Thursday.

Uber and Lyft have faced several legal challenges over their business models.

In May, California sued both firms alleging they violated a state law by classifying drivers as contractors instead of employees.

The new lawsuits go further by claiming recovery of unpaid wages, penalties and damages for drivers.

DoorDash, a food delivery platform, is also being sued by San Francisco for illegally classifying workers as contractors.

California’s state court is expected to rule Thursday on a preliminary injunction compelling Uber and Lyft to reclassify drivers as employees.

Uber, Lyft and DoorDash are backing a ballot initiative in November’s election which would classify rideshare drivers and other gig-economy workers as independent contractors.

Advertisement. Scroll to continue reading.

“We believe the courts should let the voters decide,” Lyft spokeswoman Julie Wood told CNN Business.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Headlines

NAIROBI, Kenya, Mar 16 – The World Bank has given the Kenyan government USD 60 Million (Sh6.1 billion) to help combat the deadly coronavirus pandemic...