Rideshare Attorney in California

California Wins Preliminary Injunction Against Uber, Lyft.


In a ruling stemming from a lawsuit brought the city attorneys of San Diego and two other cities and the state, a federal judge Monday August 10th granted a preliminary injunction against ride-hailing companies Uber and Lyft, requiring them to classify their drivers as employees rather than independent contractors in accordance with a new state law.


San Francisco-based Judge Ethan P. Schulman ruled in favor of California Attorney General Xavier Becerra, and the city attorneys of San Diego, Los Angeles and San Francisco in their lawsuit alleging Uber and Lyft have misclassified their drivers, preventing them from receiving “the compensation and benefits they have earned through the dignity of their labor.”


The suit alleges the companies are violating Assembly Bill 5, which went into effect Jan. 1 and seeks to ensure “gig workers” misclassified as independent contractors are afforded certain labor protections, such as the right to minimum wage, sick leave, unemployment insurance and workers’ compensation benefits.

Potter Handy, LLP serves clients throughout California, including Oakland, Los Angeles, San Diego, Sacramento, and San Francisco.

Misclassification of Employees as Independent Contractors

The amount of money rideshare drivers may be entitled to is shocking. Click on this link to our damages calculator. Enter your information and see how much money you may be owed.

Employee misclassification by employers as it pertains to independent contractors is a widespread phenomenon in the United States and California. In August 2018 the California Supreme Court adopted the “ABC test” to determine if the classification of workers. In order for its workers to be properly classified as independent contractors under the ABC test, the employer must show:

  • (A) the worker is free from the control and direction of the hiring entity in connection with the performance of the work, and
  • (B) the work performed is outside the usual course of the hiring entity’s business, and
  • (C) the worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed.

Again, the employer must prove all three. Companies such as Uber and Lyft can’t get past “B.” If the work was painting their office, Uber would have a good argument for “B” because Uber is not in the business of painting. Uber and Lyft are ride-hailing phone applications so they will not be able to argue their drivers are “outside the usual course of the hiring entity’s business.”

The costs of misclassification are staggering. As employees, drivers are entitled to reimbursement of all expenses (including 58 cents for every mile driven — not just when a customer is in the car), workers’ compensation benefits, unemployment benefits, paid rest periods, meal breaks, minimum wage, overtime, FICA tax contribution, hourly pay for all unproductive time (time spent washing car, fueling car, waiting for ride requests, driving to pick up customers, having vehicle serviced…). The statute of limitations for these claims is 4 years, so the employee is entitled to recover damages suffered over the entire past 4 years.

The amount of money rideshare drivers may be entitled to is shocking. Click on this link to our damages calculator. Enter your information and see how much money you may be owed.

Misclassification shifts huge costs from the employer to society as well. Companies such as Uber and Lyft are not contributing to unemployment insurance, state disability, other taxes, and do not provide workers’ compensation insurance for their drivers – all of which is illegal. These costs are paid by the rest of society, with the state picking up these costs or by the employee absorbing these costs themselves.

Don’t fall for scare tactics of what it means to be an employee versus an independent contractor. Uber and Lyft want you to think that as an employee you will lose all autonomy. The truth is that Uber and Lyft’s need for drivers will require them to be flexible with their drivers. As a result, the significantly higher pay you are entitled to as an employee will buy you more flexibility than you currently have.

Misclassified employees lose workplace protections, including the right to join a union; face an increased tax burden; receive no overtime pay; and are often ineligible for unemployment insurance and disability compensation. Misclassification also causes federal, state, and local governments to suffer revenue losses as employers circumvent their tax obligations.

The Costs and Consequences of Employee Misclassification

While some employers misclassify their workers as independent contractors in error, employers often misclassify their employees intentionally in order to reduce labor costs and avoid paying state and federal taxes.

Employee misclassification robs individual workers of their rights and benefits, adversely impacts the effective administration of many federal and state programs, and creates unfair competition for law-abiding employers.

Stop being taken advantage of and use our Damages Calculator for Misclassified “Gig Economy” Workers.

Independent Contractor Definition

An independent contractor provides a good or service to another individual or business, often under the terms of a contract that dictates the work outcome, but the contractor retains control over how they provide the good or service. The independent contractor is not subject to the employer’s control or guidance except as designated in a mutually binding agreement. The contract for a specific job usually describes its expected outcome. Essentially, independent contractors treat their employers more like customers or clients, often have multiple clients, and are self-employed.

Click here to see how much you are entitled to be paid.

Contact Our California Rideshare Attorney

Speak with an attorney, and let us help you figure out your best next steps. The sooner you have a plan of action, the better your chances of taking the correct steps to get the results you want. No fees will be charged unless we have a resolution in your payout.

Potter Handy, LLP serves clients throughout California, including Oakland, Los Angeles, San Diego, Sacramento, and San Francisco.

For a free case evaluation, please call our office (800) 383-7027 or email us.

*Some of the on-page content is provided by Department for Professional Employees – dpeaflcio.org