21-04-2025
- Business
- San Francisco Chronicle
San Francisco sues delivery company, alleging it misclassifies its drivers as contractors
San Francisco's legal campaign against companies that classify on-call drivers, cooks and other workers as independent contractors rather than employees has a new target: GoShare, which delivers products to businesses and private customers.
In a lawsuit being filed Monday in San Francisco Superior Court, City Attorney David Chiu's office says GoShare is violating California law and the rights of its drivers to be paid fairly for their work.
'Denying workers their benefits and wages is especially egregious when so many workers are struggling in this economy to make ends meet,' Chiu said in a statement announcing the suit.
Declaring support from organized labor, Lorena Gonzalez, president of the California Federation of Labor Unions, said that 'when companies seek a competitive advantage by misclassifying workers, everyone else loses: businesses that follow the law, and workers who are cheated out of what they've earned.'
As a Democratic Assembly member from San Diego, Gonzalez wrote AB5, the 2019 state law that defined workers as employees if they performed the same basic work as the company that hired them.
GoShare did not immediately respond to a request for comment.
The company, based in San Diego, delivers goods locally from nearby warehouses and stores in trucks and smaller vehicles owned by its drivers. Since its founding in 2015, more than 15,000 drivers have made 100,000 deliveries to customers in 15 states, Chiu's office said.
GoShare says its drivers operate their own businesses and should be considered contractors. Unlike employees, independent contractors have no legal right to minimum wages, overtime, sick leave, union representation, or payment for work expenses, such as auto repairs and fuel costs.
In 2020, a year after the labor-backed AB5 became law, California voters approved Proposition 22, which reclassified as contractors the 1.4 million app-based drivers in the state who carry passengers for Uber and Lyft or deliver food for companies such as Instacart and DoorDash.
The state Supreme Court unanimously upheld Prop. 22 last July. Chiu's lawsuit contends the ballot measure does not apply to GoShare because it schedules its deliveries in advance, giving the company more control over its services, while companies like Uber and Lyft show up when a customer calls, said Jen Kwart, a spokesperson for the city attorney.
She noted that Qwick, a company that sends food servers, cooks and other staff to restaurants and hotels and pays them after deducting a fee, agreed to reclassify its workers as employees and compensate them $1.85 million for lost wages in a settlement with San Francisco in February 2024.
GoShare drivers are also app-based and can choose their customers, facts the company could cite in arguing that it is covered by Prop. 22. But Chiu's office said in the lawsuit that GoShare decides whether to approve each customer, tracks the deliveries, penalizes drivers who show up late and pays them no more than $500 per delivery, barring them from receiving additional payments from their customers.
'GoShare's business is to provide moving and delivery services to customers,' the suit said. 'GoShare's drivers perform this very work and they do so under GoShare's control.'
The suit seeks a court order classifying the drivers as employees, compensation to the drivers for lost wages, and civil penalties payable to the city.
