Uber and Postmates have reportedly sued California in federal court over a new law raising restrictions on classifying employees as independent contractors, arguing that it is unconstitutional.
“It irreparably harms network companies and app-based independent service providers by denying their constitutional rights to be treated the same as others to whom they are similarly situated,” read the court documents.
The September law signed by Gov. Gavin Newsom (D) is aimed at strengthening rights for workers in the state and stipulates that independent contractors can only be workers who own their own business, work in a field different than the company which contracts them, and must be free to choose their own hours, according to the LA Times.
Court documents filed by Uber and Postmates also pointed to a study that found the law could raise overall operating costs for ride-sharing companies by nearly a third.
Uber and Lyft as well as the food delivery app DoorDash have reportedly planned a campaign to include an initiative on the state’s 2020 ballot that if passed would exempt the companies from the new law.