Ninth Circuit Will Rehear Uber’s Appeal Of Gig Worker Law

The Ninth Circuit Court of Appeals reversed a three-judge panel and voted to rehear Uber’s argument that it was unfairly singled out by a California law requiring that gig workers be classified as employees. 

The California legislature passed Assembly Bill 5 in 2019, after intense lobbying by organized labor in reaction to the rise of the gig economy. They viewed the new economic model as a dodge to deprive many workers of protections such as overtime pay and sick leave. App-based platforms like Uber that provide on-demand services were specifically targeted.

“Plaintiffs [Uber] plausibly allege that the primary impetus for the enactment of A.B. 5 was the disfavor with which the architect of the legislation viewed Uber, Postmates, and similar gig-based business models,” wrote Judge Johnnie Rawlinson.

The bill followed a California Supreme Court ruling that established a three-pronged standard (the “ABC test”) to classify a worker as an independent contractor.

Assembly Bill 5 codified the ABC test. For workers to be classified as independent contractors, companies must show that they do not directly control the worker; that the work falls outside its usual course of business; and that the worker is “customarily engaged in an independently established trade.”

“The panel decision correctly and unanimously reversed the district court’s dismissal of my clients’ equal protection claim,” said Theane Evangelis, an attorney for Uber. She said she looked forward to presenting the case to the full court.