A. The person is free to perform services without the control or direction of the company.
B. The person is performing work tasks that are outside the usual course of the company’s business activities.
C. The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.
Judge Schulman rejected Uber and Lyft’s argument that AB 5 does not apply to them because they are not hiring entities. He noted the “undisputed reality” that both the ride-sharing companies “hire and contract with drivers.”
He explained, “Because Defendants cannot possibly satisfy the “B” prong of that test, the likelihood that the People will prevail on their claim that defendants have misclassified their drivers is overwhelming; there is no need to address the other two prongs of the test.”
Uber and Lyft’s refusal to comply with AB 5 “represents real harms to real working people”
Additionally, Judge Shulman noted that Uber’s argument that drivers are performing a work—transporting riders— is outside the ordinary course of its business “because it is not comparable to the work performed by Uber employees.”
