Bloomberg Law
May 6, 2020, 4:51 PM

Uber, Lyft Arbitration Pacts Bypassed When Government Sues

Erin Mulvaney
Erin Mulvaney

Uber Technologies Inc. and Lyft Inc. have long used arbitration agreements to keep driver misclassification disputes out of court, eluding a conclusive ruling on their business models that rely on independent contractors rather than employees. They won’t have that shield in California’s lawsuit seeking to enforce a new state law.

California Attorney General Xavier Becerra, along with the state’s biggest cities, sued the companies on Tuesday, alleging that they violated Assembly Bill 5, or A.B. 5, a new state law that makes it harder for companies to classify their workers as contractors who don’t receive minimum wage, overtime, and ...

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