Gig Economy Seeks Injunction Against AB-5

Gig economy pioneers Uber and Postmates, along with individuals who work for those companies, filed a suit in December against the state of California in response to AB-5, a new law that reclassifies gig workers as employees (rather than independent contractors); it went into effect on January 1.

The complaint stated that AB-5 violated both the United States and California constitutions, in particular, the rights to equal protection and due process. They allege the exceptions for 20 other industries who do similar work indicate there is no rhyme or reason to the awarding of exemptions. Workers opposed to the bill state that it impacts their flexibility.

On January 8, plaintiffs filed a motion for a preliminary injunction. They argued that the bill’s sponsors arbitrarily targeted on-demand workers, and exemptions to the bill were designed to protect “politically favored groups.”  Finally, they argue that restricting the availability of flexible gig-economy jobs violates the workers’ liberty without due process. Uber, Postmates, and the individuals seeking for California to be barred from enforcing AB-5.   

In response, California filed an opposition to Plaintiffs’ motion for a preliminary injunction. California opposed the plaintiff’s claims broadly.  Specifically, they argued that AB-5 does not regulate the choice of occupation, but instead employment status generally, and those businesses are not protected from regulation.  Finally, they argue that the public interest weighs against a preliminary injunction.

The motion is set for hearing on February 7 in the California Central District Court before Judge Dolly M. Gee.