San Francisco, CA (WorkersCompensation.com) – In a move some say may be a pre-cursor to deeming drivers employees, the San Francisco City Attorney has subpoenaed records on driver wages from ride hailing companies Uber and Lyft.
On the heels of a California Supreme Court ruling that said workers could not be determined to be contract workers if their job was central the company’s core function, City Attorney Dennis Herrera subpoenaed records of driver classification, as well as their pay and benefits.
“San Francisco’s laws help ensure that employers provide a fair day’s wage for a fair day’s work,” Herrera said in a press conference on Tuesday. Herrera said the city also has laws that guarantee benefits like workers’ compensation, sick leave, and paid parental leave. “We are not going to turn a blind eye if companies in San Francisco deny workers their pay and benefits.”
The city has requested a complete list of those who have worked as drivers in the San Francisco area since 2015, how they are classified, and proof that those classified as independent contractors meet the criterion set forth by the Supreme Court’s decision, in addition to information on their wages, hours and benefits.
The move by Herrera is thought to be a pre-cursor to prosecuting the companies for not properly classifying employees. By classifying them as contractors, the companies do not have to cover them with workers’ compensation insurance, or meet other employment regulations such as minimum wage laws and family leave laws.
While the Supreme Court’s ruling is not finalized, it said workers are independent contractors only if their tasks fall outside of the scope of the hiring company’s business, the company does not control how they work, and the workers run their own independent business doing that work.
“Reading the tea leaves, I assume he’s headed down that path,” said Aaron Kaufmann, a partner at labor-law firm Leonard Carder in Oakland, told the San Francisco Chronicle. “If so, it could be very significant because he has the ability to get systemic relief, at least for drivers in San Francisco.”
Some say that any lawsuit could end up affecting the employment status of all Uber and Lyft drivers in California.
“To me it’s clear that under that test (ride hailing drivers) come out as employees,” Kaufmann said. “Drivers provide the very services that Uber and Lyft are in the marketplace to provide. I think that’s what Dennis Herrera is banking on, and it’s a pretty good bet.”
If the workers were found to be employees, the companies would face millions more in operating costs for benefits, workers’ compensation and minimum wage requirements.
While Lyft told the Chronicle its drivers earn more than $25 per hour before expenses, research indicates that many drivers make less than minimum wage. And in July of last year, Uber launched a pilot program (as reported by WorkersCompensation.com) to provide drivers with a type of workers’ compensation insurance that drivers would pay for through a per fare increase in fees.