Uber and Lyft Could Owe Drivers Billions: What the California Wage Theft Case Means for You
A major legal battle is unfolding in California, and for thousands of rideshare drivers, the stakes are enormous. A state appeals court recently ruled that Uber and Lyft may be responsible for billions of dollars in unpaid wages. The case centers on allegations that both companies misclassified drivers as independent contractors instead of employees. For many drivers, this issue is not just about job classifications. It is about lost wages, lack of benefits, and years of being denied basic labor protections.
At Fraigun Law Group, we represent individuals across Southern California who have experienced wage theft and misclassification. From our office in Sherman Oaks, Marina Fraigun leads our plaintiff-focused legal team in holding employers accountable when they violate state labor laws.
What Is the Wage Theft Case Really About?
The lawsuit ties directly to California’s Assembly Bill 5 (AB 5), passed in 2019. AB 5 set a clear legal standard, known as the ABC test, to determine whether someone is legally considered an employee. Under this test, most rideshare drivers should have been classified as employees. That classification would have granted them key legal protections, including minimum wage, overtime pay, reimbursement for job-related expenses, paid sick leave, and unemployment insurance.
Instead, drivers were labeled independent contractors and denied those protections. As a result, the court found that Uber and Lyft may have violated state wage and hour laws by avoiding payroll taxes and failing to provide legally required compensation. According to California’s Labor Commissioner, wage theft includes underpayment, missed breaks, improper deductions, and failing to pay overtime. In this case, it may also include not covering job-related expenses like fuel, vehicle maintenance, and even cell phone use.
Why This Case Matters Beyond Rideshare Companies
This case is not just about Uber and Lyft. It sets a precedent for how companies across California treat their workforce. It also sends a message that state labor laws are not optional. Many other industries rely on flexible or on-demand workers and could face similar scrutiny if they ignore employee classification laws. The court’s decision also calls into question the long-term impact of Proposition 22, a 2020 ballot initiative that exempted companies like Uber and Lyft from AB 5. That law was partially overturned in 2021, and this case may influence future legal challenges.
What Drivers Can Do Next
If you drive for Uber, Lyft, or any other platform-based company and believe you were denied wages, there are steps you can take. Keep records of your hours, earnings, expenses, and communications with the company. These details could become critical if you are eligible to join a class action or file a wage claim. Fraigun Law Group helps workers in Los Angeles, the San Fernando Valley, and throughout Southern California take legal action against employers who break the law. We know the tricks companies use to avoid accountability, and we are committed to helping you recover what you are owed.
Take Action If Your Rights Were Violated
You do not have to accept wage theft as a condition of employment. If you believe you were misclassified, paid less than minimum wage, or denied lawful benefits, contact Fraigun Law Group for a consultation. We can help you understand your rights and take meaningful steps toward justice.
