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Uber, Postmates sue to challenge California's new labor law

The law creates the nation's strictest test by which workers must be considered employees

CALIFORNIA, USA — Ride-share company Uber and on-demand meal delivery service Postmates are suing to block a broad new California law aimed at giving wage and benefit protections to people who work as independent contractors. 

The lawsuit filed in court Monday argues that the law set to take effect Wednesday violates federal and state equal protection and due process guarantees. The law makes it harder for companies to classify workers as independent contractors instead of employees, who are entitled to minimum wage and benefits such as workers compensation.

That wasn't the only fight against AB 5. A federal judge temporarily blocked the new California labor law from impacting more than 70,000 independent truckers. The judge granted a temporary restraining order Tuesday sought by the California Trucking Association, saying the association is likely to eventually prevail on its argument that the law violates federal law. Democratic Assemblywoman Lorena Gonzalez says the state will continue to fight the association.

The law creates the nation's strictest test by which workers must be considered employees. It could set a precedent for other states. Gonzalez says the law extends employee rights to more than a million California workers who lack benefits.



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