New Legal Battle Begins Over Gig Economy Work At Uber And Lyft
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Three Uber and Lyft drivers filed a class action lawsuit in California on Tuesday over alleged anticompetitive practices that impact gig economy workers.

The two firms “label their drivers independent contractors, yet deprive those drivers of economic independence by fixing the prices that drivers must charge to customers for rides,” according to the suit filed by legal nonprofit Towards Justice, which argued that the drivers would have increased earnings under a regime with more pricing freedom.

“Uber and Lyft have insisted that they do not employ their drivers,” David Seligman, executive director of Towards Justice, said in a press release. “But if Uber and Lyft are not employers responsible to their employees under labor standards laws, then they are powerful corporations that fix prices, abuse their power, and deceive the workers who drive their profits.”

Beyond the purported price fixing, the plaintiffs argue that Uber and Lyft have been taking greater portions of the sums that riders pay for the service.

Two years ago, a California court ruled in favor of Uber and Lyft in a lawsuit that would have pressed the firms to classify independent contractors as employees. The most recent lawsuit against the firms also comes one year after Democratic lawmakers introduced the Protecting the Right to Organize (PRO) Act, which would narrow the definition of an independent contractor under the guise of granting them more protections.

“Big Labor incrementally attacks any form of gig work, or contracting, and they come for ride sharing companies first,” Gabriella Hoffman, a freelance media strategist and Townhall columnist who has written extensively about the gig economy, told The Daily Wire. “If you poll rideshare drivers, however, they voluntarily go into this line of work and enjoy the flexibility that comes with the job.”

Indeed, Uber released a poll in 2020 showing that drivers preferred to remain as independent contractors when offered a handful of benefits by the company, according to Axios. Another poll from Lyft likewise showed that most drivers preferred their contractor arrangements.

Pew Research found in 2021 that 16% of Americans — including 30% of Hispanics, 20% of African Americans, and 12% of whites — have participated in gig economy work, such as shopping for and delivering groceries, cleaning homes, or delivering packages. Young Americans and those with low incomes are most likely to earn money through a gig platform.

“Independent contracting liberates workers from the constraints of traditional work — including unionized jobs,” Hoffman argued. “Workers want more flexibility and freedom to be more fulfilled in their careers. … Freelancing, as a whole, is a pro-family, pro-free enterprise, pro-free market policy that empowers individuals. And it’s a great option for women who juggle career and family.”

Although unemployment is presently 3.6% and wages are nominally rising, real average hourly wages dropped 3% between May 2021 and May 2022 amid rising inflation — meaning that Americans must tighten their budgets or work more than last year to enjoy the same standard of living. Accordingly, a poll taken earlier this year by Branch and Marqeta showed that 85% of respondents “increased or planned to increase their gig work,” with 58% “citing inflation as the primary reason.”

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