US Appeals court revives appeal against California AB5 tests
On Friday, a lawsuit by Uber Technologies Inc and subsidiary Postmates Inc against a California law that requires them to provide more evidence that workers are independent contractors was revived by a U.S. appeals court.
The 9th U.S. Circuit Court of Appeals, based in San Francisco, ruled that the law known as AB5 is unconstitutional as it unfairly targets app-based transportation companies while excluding many other industries.
The ruling is seen as a victory for app-based services that rely heavily on contractors, and Uber celebrated the decision in a statement, saying it was another signal that drivers' independence and flexibility would prevail.
After the 9th U.S. Circuit Court of Appeals ruled that California's AB5 law is unconstitutional, the office of California Attorney General Rob Bonta, a Democrat, announced that it was reviewing the decision and considering its next steps. Bonta's office declared that it would continue to defend laws aimed at protecting workers and promoting fair labor and business practices.
AB5, which was implemented in 2020, sets a higher standard for proving that workers are independent contractors rather than employees, who enjoy greater legal safeguards and can cost companies up to 30% more. Although California lawmakers excluded many occupations and businesses from AB5's jurisdiction, including "referral agencies," which link workers with customers, app-based transportation...
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