California just passed a major workers’ rights bill that’s expected to change the status of at least one million contract workers.
Uber’s Chief Legal Officer Tony West said in a statement that Uber should be able to escape a new regulation requiring workers to be considered employees instead of contractors if they meet certain requirements. The comments follow the California legislature’s workers’ rights bill, AB5, which was passed on Wednesday.
The bill comes with a set of requirements that, if met, would allow any worker to be considered an employee. Uber is doubtful that the bill applies to them and their drivers. The main reason for this is the caveat that Uber doesn’t consider drivers to be doing work that falls within the “usual course” of its business. This may come as a surprise to many who would assume that drivers are performing a central role in providing the service that Uber sells. According to Uber CLO Tony West, “Under [AB5’s] three-part test, arguably the highest bar is that a company must prove that contractors are doing work ‘outside the usual course’ of its business[…] But just because the test is hard does not mean we will not be able to pass it. In fact, several previous rulings have found that drivers’ work is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces.”
With Uber’s recent stance being made clear, it appears the company will try to fight attempts to classify drivers not as contractors, but as employees. In doing so, the company will have to effectively convince a judge that drivers don’t play a central role in Uber’s business.