By Hannah Albarazi

Law360, San Francisco (April 22, 2020, 7:43 PM EDT) -- Uber told a California federal judge Wednesday it will roll out greater sick leave protections as part of a negotiated resolution with California drivers claiming the ride-hailing giant is exacerbating the COVID-19 pandemic, prompting the judge to inquire whether Uber couldn't extend those protections to Massachusetts drivers seeking emergency relief.

While the terms of the negotiated resolution between Uber and California drivers are expected to be made public next week, drivers' counsel said during a video hearing Wednesday that the resolution puts to rest the California drivers' bid for an emergency order seeking to classify drivers as employees, rather than independent contractors.

Drivers in California and Massachusetts have argued that Uber is putting the public at risk by misclassifying drivers as independent contractors — with no paid sick leave — causing drivers potentially infected with COVID-19 to keep working.

The California drivers, who will no longer move forward as a class but will proceed with individual claims, said they intend to seek summary judgment and urged U.S. District Judge Edward Chen on Wednesday not to allow Uber to delay the case with unnecessary discovery.

"Uber is going to do whatever it can to stall out a ruling," counsel for the drivers, Shannon Liss-Riordan of Lichten & Liss-Riordan PC, told the court. But Judge Chen said he saw no reason why Uber's discovery couldn't be succinct.

The Massachusetts drivers' motion for a preliminary injunction — requiring Uber to classify them as employees — remained unresolved Wednesday, with the drivers standing firm and Uber repeatedly urging Judge Chen to grant its motion to compel arbitration in that case.

Judge Chen said that in his view, the moral and ethical thing to do would be for Uber and the drivers to put the public interest and public health first and urged them to try to extend the negotiated resolution with the California drivers to Massachusetts drivers.

Judge Chen instructed the parties to protect the health of drivers, passengers and the public during the pandemic as best they can, "rather than engaging in brinkmanship."

The issue of worker classification in the gig economy has reached a fever pitch during the novel coronavirus pandemic as the crisis has prompted a huge decline in demand for ride-hailing jobs and a massive spike in demand for delivery driver jobs. The pandemic has highlighted the economic reality faced by independent contractors without job security or benefits during a crisis.

Both Uber and Lyft have been facing drivers' emergency requests for injunctive relief in light of the pandemic. 

The drivers' requests come roughly three months after California enacted A.B. 5, which codifies into law the landmark California Supreme Court decision in Dynamex Operations West v. Superior Court. The California statute requires employers to prove, among other things, that the worker performs work outside its main business in order to be classified as independent contractors.

But in early April, another California federal judge remanded to state court a bid by Lyft drivers to immediately classify them as employees eligible for sick leave amid the coronavirus pandemic.

But Lyft drivers nabbed a small victory in Massachusetts last month after a federal judge ruled that Lyft can't force its drivers there to arbitrate their misclassification claims, saying the workers are exempt from the Federal Arbitration Act.

While Uber expressed a willingness Wednesday to extend the California sick leave resolution to Massachusetts, counsel for the drivers stood behind the drivers' bid for a preliminary injunction, saying Uber is "degrading labor standards in the commonwealth" and posing a burden on the public.

But Uber's counsel, Theane Evangelis of Gibson Dunn & Crutcher LLP, told the court that Uber isn't the drivers' employer and that the Massachusetts drivers have failed to show that they would suffer irreparable harm if an injunction is not entered. Evangelis urged the court to compel arbitration.

Judge Chen said he understands the Massachusetts drivers' "anxiousness" regarding the pandemic and their situation, but said a preliminary injunction is a "poor method" for getting relief.

Liss-Riordan said the resistance by courts to rule on "Uber's flagrant violation of the law" has been frustrating.

"Through the farce of arbitration, companies like Uber have been able to avoid for years any court rulings on the legality of their entire model of depriving workers their rights as employees. This case presents an unusual opportunity," Liss-Riordan told Law360. "The Supreme Court has never confronted the question of whether a company can sidestep the law altogether by shielding itself with an arbitration clause when its actions are exacerbating a global pandemic."

Uber declined Law360's request for comment.

The drivers are represented by Shannon Liss-Riordan and Anne R. Kramer of Lichten & Liss-Riordan PC.

Uber is represented by Theane Evangelis, Heather Richardson and Blaine Evanson of Gibson Dunn & Crutcher LLP.

The cases are Verhines v. Uber Technologies Inc., case number 3:20-cv-01886, Colopy et al. v. Uber Technologies Inc., case number 3:19-cv-06462, and Capriole v. Uber Technologies Inc. et al., case number 3:20-cv-02211, in the U.S. District Court for the Northern District of California.

--Editing by Orlando Lorenzo.

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