(VOR News) – Uber and Lyft filed a challenge to litigation brought by the state of California on behalf of drivers who signed agreements to prevent legal disputes with ride-hailing businesses from reaching the courtroom.
These transporters were embroiled in a legal dispute regarding their classification as contractors or employees. The argument will not be taken into account by the Supreme Court of the United States, as announced on Monday.
The justices rejected Uber and Lyft’s appeals based on a California state appeals court decision.
The court had permitted the Democratic-led state’s attorney general and labor commissioner to pursue claims that Uber and Lyft owe money to drivers who were incorrectly classified as independent contractors rather than employees. The claims could be pursued by the state’s attorney general and labor commissioner, as per the decision.
The businesses have contended that the federal law prohibits states from pursuing lawsuits on behalf of individuals who have signed agreements to resolve legal disputes in private arbitration rather than in formal judicial procedures. This category encompasses over sixty million employees in the United States.
Furthermore, this Uber and Lyft category encompasses virtually any customer who registers for a product, adheres to the terms of service of a corporation, or subscribes to a service.
A statement was disseminated via email by Theane Evangelis, an attorney who represents Uber. Evangelis maintained in the statement that the California court’s decision was incorrect and suggested that the Supreme Court could address the matter in a future case.
In 2020, the state of California filed numerous lawsuits against the companies. In 2023, a state appeals court issued a verdict that was unfavorable to the firms due to their opposition to the litigation that was being initiated as a consequence of the litigation. The Supreme Court of California announced immediately thereafter that it would not be pursuing the appeals that had been submitted.
Uber and Lyft have been accused of violating a variety of rights, such as the minimum wage, overtime compensation, reimbursement for expenses, and reimbursement for additional expenses, due to the fact that they designate their drivers as independent contractors.
Uber and Lyft have asserted this in many Democratic-controlled states, including California.
Firms are significantly more cost-effective when they employ independent contractors, as the majority of federal and state wage standards are exclusively applicable to employees.
Several app-based companies, including Uber and Lyft, have refuted allegations that they are employers of “gig workers” who may benefit from the flexibility of contracting.
This industry has been a substantial supporter of state ballot measures that would enable businesses to consider their employees independent contractors in exchange for providing them with specific benefits. The state referendum would include these propositions on the ballot.
The proposition that was promoted by Uber and Lyft and was adopted by California voters in 2020 with a resounding majority was upheld by the state’s highest court in July. Individuals within the province authorized the initiative.
Uber and Lyft have agreed to impose a minimum hourly salary of $32.50 on drivers in the state of Massachusetts and to pay a total of $175 million in accordance with the terms of a settlement agreement that was reached in June.
The attorney general of the state, who is managed by Democrats, alleged in the complaint that the corporations had treated chauffeurs in an unjust manner by treating them as independent contractors.
Additionally, a substantial number of drivers in the United States have initiated legal proceedings against Uber and Lyft, arguing that they are of the opinion that they should have been legally recognized as laborers.
However, only a small number of those cases have yielded definitive decisions, and a significant number of them have been referred to arbitration. This is due to the fact that the majority of drivers who are employed by companies execute arbitration agreements.
SOURCE: USN
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