General Update on AB5 in California

Wayne Schooling, CPSA • August 13, 2020

On Monday, August 10, 2020 San Francisco Superior Court Judge Ethan Schulman issued a preliminary injunction classifying California Uber and Lyft

drivers as employees, not independent contractors.

The Judge, using scathing language about ride-hailing companies, issued a 34-page order granting the Labor Commissioner’s request for a preliminary injunction, in light of the ride-hailing companies “prolonged and brazen refusal to comply with California law” namely AB5.

This gig-work law that took effect in January, made it harder for companies to claim workers as independent contractors and has been highly criticized by many companies.

While the enforcement of the Judge’s order is not set to take effect until ten days from now, this gives Uber and Lyft plenty of time to appeal the decision. As we can see, this is not the end of the road on the debate of whether Uber and Lyft drivers are in fact, independent contractors.

AB5 Trucking Update

According to our sources, the Ninth Circuit plans to hear oral argument on September 1, 2020 in CTA v. Becerra—the federal district court decision enjoining the State of California from enforcing California Assembly Bill 5 (AB5) against motor carriers.

The Ninth Circuit typically issues decisions within three months to a year of oral argument, so we may know where the Ninth Circuit stands on the enforceability of AB 5 against motor carriers by the end of the year.

This does not necessarily mean an end to the AB5 controversy is in sight, considering most pundits agree the decision will be appealed to the United States Supreme Court regardless of where the Ninth Circuit lands on the issue.

We will continue to follow this case until we have a final decision on this case. To learn more about AB5 and to ensure that your independent contractors are properly classified, contact the NorthAmerican Transportation Association, Attention Wayne Schooling ([email protected])

The material in this article, provided by NorthAmerican Transportation Association, is designed to provide informative and current information as of the

date of the post. It should not be considered, nor is it intended to constitute, legal advice or promise similar outcomes.

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