Are Uber drivers employees?

Today’s question comes from Jennifer T. in Diamond Heights who asks:

Q: “I drive for Uber, Lyft, and DoorDash. I have filed my taxes as an independent contractor as that’s what I was told to do by these companies. I heard that there is a new law which will provide me with protections that usually have only been provided to employees. What am I, an independent contractor or employee? What new protections do I have now?”

A: The new law that you have heard about, AB 5, amends Labor Code Section 3351, adds a new Labor Code Section 2750.3, and amends sections 606.5 and 621 of the Unemployment Insurance Code, to ensure the workers who are currently exploited by being misclassified as independent contractors are instead recognized as employees who have basic rights and protections. The legislative history produced during its enactment declared that when workers are unfairly misclassified as independent contractors: (1) these workers are harmed by the loss of significant workplace protections such as they deserve under the law, including a minimum wage, workers’ compensation if they are injured on the job, unemployment insurance, paid sick leave, and paid family leave; (2) it is unfair to other employers who must compete with companies that misclassify; and (3) there is harm to the state of California in the form of lost revenue from these companies avoiding obligations such as payroll taxes and premiums required under workers’ compensation, Social Security, unemployment, and disability insurance programs.

The new Labor Code Section 2750.3(a)(1) remedies these injustices by providing that a person providing labor or services for remuneration (money) shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that all of the following conditions are satisfied: (A) The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the terms of the contract for the performance of the work and in fact; (B) the person performs work that is outside the usual course of the hiring entity’s business; (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.

The amended Labor Code Section 3351 provides that the law applies to every person in the service of an employer under any appointment or contract of hire or apprenticeship, express or implied, oral or written, whether lawfully or unlawfully employed, and specifically includes: non-resident immigrants and those without proper documentation; minors; elected and appointed paid public officers; incarcerated persons engaged in vocational rehabilitation for pay; truck drivers; and tutors. The law also exempts a long list of occupations including, but not limited to: physicians and surgeons; dentists; podiatrists; psychologists; veterinarians; licensed lawyers, architects, engineers, private investigators, accountants, barbers, estheticians, and cosmetologists; registered security brokers and advisors; real estate salespeople; live-in nannies; direct sales people; and commercial fisherman. The law also does not apply to any workers who can negotiate for their rate of pay, control their hours, and market themselves to multiple businesses, such as: travel agents; outsourced marketing consultants; HR administrators; graphic artists; design professionals; grant writers; fine artists; tax preparers; some still photographers; photojournalists; freelance writers who only do occasional work; repossession agents; and construction trucking service providers.

You, as a Lyft, Uber, and DoorDash driver, are squarely protected under this law and must now receive the benefits other employees would receive, including earning at least the minimum wage. In its perpetual refusal to follow the law, Uber has indicated that it will not comply with AB 5 and filed a federal lawsuit at the end of last year claiming the law to be unconstitutional. Notably, it did not file in a California State Court, which it predicts would be a futile exercise because AB 5 was based on a groundbreaking California Supreme Court decision, Dynamex Operations West, Inc. v. Superior Court of Los Angeles (2018) 4 Cal.5th 903 (“Dynamex”), which established the new test for determining whether a particular set of job circumstances make someone an employee or independent contractor. Uber hopes the conservative U.S. Supreme Court will be more receptive to their pleas. Fortunately, this will likely be an uphill battle as the Supreme Court has routinely upheld a state’s rights to legislate its own citizens’ working conditions.

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Pause and Think Before You Hit Record: The Implications of Secret Recordings in the Workplace

By: Christopher Dolan and Vanessa Deniston

 

This week’s question comes from Edgar M…

Q: “I work for a large corporation with offices nationwide. I was recently switched to a new department, and already, I have been having problems with my new direct supervisor. He regularly makes racially charged comments around me, which I find offensive. I have told him to stop, but that has only made things worse. I have tried complaining to my HR representative about this behavior, but she is good friends with my direct supervisor and doesn’t believe my reports. I feel the only way I will be taken seriously is if I am somehow able to record my supervisor’s racist comments as proof. Can I do this if no one will take me seriously?”

A: Thank you for your question, Edgar. Certainly, the impulse to capture an injustice on tape is a hard impulse to ignore, especially when those around you are turning a blind eye to or claiming it isn’t happening. Secretly recording someone without their knowledge and consent, however, is a criminal offense under state and federal law with serious consequences.

The federal Wiretap Act of 1968 (18 U.S.C. § 2511) provides it is illegal to secretly record any oral, telephonic, or electronic communication that the communicator would reasonably expect to be private. The California Penal Code § 632(a), enacted under the California Invasion of Privacy Act of 1967, makes it illegal for any person to intentionally and without the consent of all parties to a communication use a recording device to record a confidential communication, whether or not the conversation occurs in person or through some other medium, such as over the phone. Such an offense may be punished by a fine of up to $2,500 per violation and/or by a term of imprisonment of up to one year. California is one of a handful of states with a “two-party [or “all-party”] consent” law, meaning the consent of every single party to the conversation is required before a person can legally record a confidential conversation. In other words, if nine out of ten board members agree you can record a private board meeting, that is one too few.

These criminal consequences will outweigh any potential benefit you may derive from capturing such evidence on tape, especially because in nearly all cases, secret recordings are not admissible evidence in court. Penal Code § 632(d) provides that unless you are trying to prove a violation of section 632 itself, any evidence obtained as a result of recording a confidential communication is not admissible in any judicial, administrative, legislative, or other proceeding. In short, if you have a secret recording of your supervisor spouting racist inappropriate comments that you feel is a smoking gun for your case, it will likely be excluded long before a jury can ever hear about it.

The grey area lies in whether there is a reasonable expectation of privacy in the space where the recording is made. The answer to this question depends on the recording’s location and context. For instance, there is a big difference between recording a conversation in a busy airport terminal and recording a private disciplinary meeting between you, your supervisor, and a Human Resources representative in an office behind a closed door. This is because it is reasonable to expect that a conversation in public airport terminal to be overheard by people passing by. The same is not true for the private HR meeting. 

Context may be nuanced, however. There may be reasonable expectation of privacy in that same airport terminal at 4:00am on arrival of a red-eye flight if the conversation occurs in an empty corner of the terminal where there are no staff or people in sight. Likewise, a conversation at top volume in the doorway of your supervisor’s office adjacent to an open floor plan in earshot of the entire office. There is quite a different expectation of privacy in this context, as opposed to the private HR meeting.

Even if you believe, however, that you are in an environment where there is no reasonable expectation of privacy, there are many variables to be considered and it’s likely not worth the risk. If you believe your supervisor is doing or saying something inappropriate, rather than record them, make a written complaint to your Human Resources department, quoting the specific language you heard or describing the conduct you observed and indicating it made you feel uncomfortable. By creating a written record with your employer, you protect yourself far more than you do by making a recording that could potentially expose you to criminal liability.  Always contact an employment attorney to assist you in taking legal, effective steps towards addressing a difficult workplace issue.

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