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California's Labor Commission has filed lawsuits against Uber and Lyft, accusing them of "committing wage theft by misclassifying employees as independent contractors." The suit will replace individual claims that drivers have filed.
Why it matters: This is the latest move by California officials seeking to force the companies to reclassify their drivers from independent contractors to employees following a new law that went into effect in January.
- Meanwhile, a court hearing is scheduled for Thursday regarding the state attorney general's request for an injunction to force the companies to comply. Three city attorneys are also participating in this lawsuit.
- San Francisco's district attorney has separately sued delivery company DoorDash on similar grounds.
- The three companies and others are also behind a measure on November's ballot that would keep drivers as contractors, along with some new benefits.
From Lyft:
The state labor agency has botched thousands of claims. They know they don't have the ability to process these claims, so they sent them into a legal abyss, where they know it will take years to resolve them.— Lyft spokesperson
From Uber:
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. 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 spokesperson
Editor's note: The story has been updated with a statement from Uber.