Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour Class and PAGA Actions (24th Edition) 25 has a significant, impermissible effect on motor carriers’ “prices, routes, and services” that runs afoul of the FAAAA.120 Shortly thereafter, the State appealed and the Ninth Circuit reversed in California Trucking Ass’n v. Bonta. The Ninth Circuit held that AB 5 had only a tenuous, remote, or peripheral connection to rates, routes, or services and thus was not preempted by FAAAA as applied to motor carriers.121 The Bonta court found that “AB-5 is a generally applicable labor law that impacts the relationship between a motor carrier and its workforce, and does not bind, compel, or otherwise freeze into place a particular price, route, or service of a motor carrier at the level of its customers, it is not preempted by the [FAAAA].”122 As a result, the State of California was not enjoined from enforcing AB 5 “against motor carriers operating in California.”123 The California Trucker’s Association then petitioned the United States Supreme court for certiorari, but the petition was denied.124 2. Olson v. State of California: AB 5 Does Not Violate the Equal Protection Clause In Olson v. State of California, companies that operated app-based platforms that connected both consumers and riders with rideshare and delivery drivers (i.e. Uber and Postmates), and individual drivers who used the platforms to connect with either riders in need of transportation or consumers in need of deliveries brought an action seeking declaratory and injunctive relief based on their allegations that AB 5 violates the Equal Protection Clause of the California and United States Constitutions.125 The U.S. District Court disagreed with the companies’ contention that AB 5 was unconstitutional in applying a different test for employee/independent contractor status to them than it did to certain other types of companies, noting that the law was enacted to deal with the “systematic problem of misclassification” where “businesses [were] improperly characterizing their workers as independent contractors to avoid fiscal responsibilities owed to employees.”126 The Ninth Circuit affirmed the distict court’s decision, noting that “[t]here are plausible reasons for treating transportation and delivery referral companies differently from other types of referral companies, particularly where the Legislature perceived transportation and delivery companies as the most significant perpetrators of the problem it sought to address — worker misclassification.”127 E. California Voters Adopt Proposition 22 The California Attorney General, in People v. Uber Technologies, Inc.,128 sued ride-share companies for a preliminary injunction against the classification of drivers as independent contractors. The trial court granted the requested relief, finding the State had shown a reasonable probability—indeed, “an overwhelming likelihood”—of 120 Becerra, 433 F. Supp. 3d at 1166. 121 996 F.3d 644, 658-661 (9th Cir. 2021). 122 Id. at 664. 123 Id. 124 California Trucking Ass'n, Inc. v. Bonta, 142 S. Ct. 2903 (2022). 125 Olson v. State of California, 104 F. 4th (9th Cir. 2024). 126 Id at 71. 127 Id. at 72. 128 56 Cal. App. 5th 266 (2020).
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