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California sues Uber and Lyft for misclassifying drivers as contractors

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Attorney general says the state will make the companies ‘play by the rules’ and adhere to the worker rights and protections law

California is suing Uber and Lyft, alleging they misclassified their drivers as independent contractors under the state’s new labor law, in the most significant challenge to the ride-hailing companies’ employment model to date.

Xavier Becerra, the state’s attorney general, announced the lawsuit Tuesday during a news conference. The labor law, known as AB5 and considered the nation’s strictest test, took effect on 1 January and makes it harder for companies to classify workers as independent contractors instead of employees who are entitled to minimum wage and benefits such as workers compensation and unemployment benefits – a key exclusion that has come to the fore during the coronavirus pandemic.

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