A California agency is suing Uber and Lyft over alleged wage theft, saying the ride-hailing companies have misclassified drivers as independent contractors.
The state's Department of Industrial Relations announced Wednesday that the Labor Commissioner's Office filed separate lawsuits against the two California-based companies over their classification of drivers.
"The Uber and Lyft business model rests on the misclassification of drivers as independent contractors," said California Labor Commissioner Lilia García-Brower in a statement. "This leaves workers without protections such as paid sick leave and reimbursement of drivers' expenses, as well as overtime and minimum wages."
García-Brower's office said nearly 5,000 drivers have filed complaints against Uber and Lyft for owed wages. She said misclassification also affects other expenses for drivers.
When reached for comment, an Uber spokesperson said the company has not had the opportunity to review the claims because they "have not been served" the lawsuit.
“The vast majority of California drivers want to work independently, and we’ve already made significant changes to our app to ensure that remains the case under state law," the spokesperson added. When 3 million Californians are without a job, our leaders should be focused on creating work, not trying to shut down an entire industry.”
In a statement to The Hill, Lyft said: "The state labor agency has botched thousands of claims. They know they don't have the ability to process these claims, so they sent them into a legal abyss, where they know it will take years to resolve them."
California voters will soon get a chance to weigh in on the issue through a November ballot initiative.
If passed, Proposition 22 would define app-based transportation and delivery drivers as independent contractors and adopt labor and wage policies specific to app-based companies.
Updated at 12:43 p.m.