SACRAMENTO, California (AP) — Ride-share company Uber and on-demand meal delivery service Postmates have sued to block a broad new California law aimed at giving wage and benefit protections to people who work as independent contractors.
The lawsuit filed in U.S. court in Los Angeles Monday argues that the AB-5 labor law set to take effect Wednesday (Jan. 1) violates federal and state constitutional guarantees of equal protection and due process.
The law creates the nation’s strictest test by which workers must be considered employees and it could set a precedent for other states.
The lawsuit contends that AB-5 exempts some industries but includes ride-share and delivery companies without a rational basis for distinguishing between them. It alleges that the law also infringes on workers’ rights to choose how they make a living and could void their existing contracts.