Uber Technologies Inc (NYSE:UBER) will be hit with a class-action lawsuit in California over claims that UberEats drivers should be granted work-related expenses.
In a landmark case, the state’s supreme court unanimously ruled that driver Erik Adolph could pursue his claim against the taxi-come-delivery company despite previously signing an agreement to privately settle lawsuits with the company.
Having sued Uber in 2019 over its alleged misclassifying of drivers as contractors rather than employees, Adolph claimed Uber drivers should be reimbursed for work expenses.
An arbitration agreement with Uber meant he had agreed not to pursue cases against the company in court though.
However, Monday’s ruling found Adolph could indeed follow proceedings given California’s Private Attorney General Act (PAGA), which allows workers to sue employers on behalf of the state.
“Our task is to give effect to the statute as we find it,” the court said in Monday’s ruling.
“Under the statute, a plaintiff who files a PAGA action with individual and non-individual claims does not lose standing to litigate the non-individual claims in court simply because the individual claims have been ordered to arbitration.”
Adolph’s lawyer Michael Rubin suggested the ruling could prevent companies from pushing workers’ lawsuits into arbitration in the future.
Given over half of America’s non-union private sector workers are required to sign such agreements, this could mark a potential blow.
Uber lawyer Theane Evangelis said the company was considering “appellate options” in response, arguing the ruling had contradicted previous cases in the US.