San Francisco District Attorney Chesa Boudin on Tuesday filed a lawsuit against the food-delivery service DoorDash, asserting that the company “continues to illegally misclassify its delivery workers as independent contractors when, in fact, they are employees.”
The move is the latest in a series of legal skirmishes over California AB5 (Assembly Bill 5), a state law that went into effect Jan. 1 aimed at forcing gig economy companies to treat their drivers as employees rather than contractors. Last month, California state attorney general Xavier Beccera, together with San Francisco, San Diego and Los Angeles, filed a similar lawsuit against
(LYFT) seeking the ride-sharing services to force them to comply with the law.
Uber, Lyft and DoorDash, which is based in San Francisco, are the key drivers behind a November 2020 ballot proposition intended to exempt the gig economies from the provisions of AB5, an end-run to removing the law from the books. Last week, the California Public Utilities Commission ruled that AB5 applies to ride-sharing services, a decision that in theory could result in the two companies losing their right to operate in the state.
The gig companies have resisted implementing AB5, which would almost certainly raise their labor costs. The companies have said it would result in a smaller number of drivers, with reduced flexibility to set their hours.
Alex Bastian, a spokesman for the San Francisco DA’s office, said that any injunctive relief granted by the court in the case would cover the company’s operations throughout the state.
In the complaint, the city claims that the distinction between contractors and employees is a critical one, since state law grants rights to employees that contractors do not enjoy. “When employees are misclassified, they are unlawfully denied their guaranteed rights to minimum labor standards, including minimum wage and overtime pay, meal and rest breaks, workers’ compensation coverage, paid sick leave, family leave, reimbursement for business expenses, and access to wage replacement programs like disability insurance and unemployment insurance,” the complaint asserts.
In response to the lawsuit, Max Rettig, DoorDash’s global head of public policy, said that the suit “seeks to disrupt the essential services Dashers provide, stripping hundreds of thousands of students, teachers, parents, retirees and other Californians of valuable work opportunities, depriving local restaurants of desperately needed revenue, and making it more difficult for consumers to receive prepared food, groceries, and other essentials safely and reliably. We will fight to continue providing Dashers the flexible earning opportunities they say they want in these challenging times.”
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