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A new lawsuit alleges Uber is violating California’s rideshare law and should not be allowed to assert its drivers are independent contractors., a ballot initiative that exempted Uber and other app platforms from labor law and allowed them to keep classifying their workers as contractors instead of employees.
The measure included a promise that drivers would have an appeals process.Rideshare Drivers United, a drivers group that says it has about 20,000 members in California, said Monday that because Uber has violated Prop. 22 by not delivering on all its promises, it should not be allowed to continue to assert that its drivers are independent contractors.Uber has failed to create an appeals system to give drivers due process when they’re kicked off the app, violating the California law it carved out that declared app-based drivers independent contractors, a lawsuit filed Monday alleges., a ballot initiative that exempted Uber and other app platforms from labor law and allowed them to keep classifying their workers as contractors instead of employees. The measure included a promise that drivers would have an appeals process. Rideshare Drivers United, a drivers group that says it has about 20,000 members in California, said Monday that because Uber has violated Prop. 22 by not delivering on all its promises, it should not be allowed to continue to assert that its drivers are independent contractors. “Uber has not met the conditions to take advantage of Prop. 22,” Shannon Liss-Riordan, a Massachusetts-based lawyer who has challenged Uber and other gig companies for years and is representing the California group, told CalMatters. Many deactivated drivers report that they struggle to appeal their cases. They say they are initially sent to sites where they appear to be talking with bots, then eventually reach agents who are working from a script and appear to be in another country. Rarely do they reach people who are empowered to truly help them, they say. Liss-Riordan said at a news conference in San Francisco that she is seeking a declaration from the court saying that the company is violating the law it wrote, which she said should help drivers who are pursuing individual arbitration of their cases. “We're going to seek back pay and other damages for them if they were unfairly deactivated, and we're also going to be seeking their rights under the labor code,” she said. Among the promises of Prop. 22: guaranteed minimum earnings of 120% of minimum wage for active ride or delivery time; health care stipends for those who qualify; occupational accident insurance and accidental death insurance; and “mandatory contractual rights and appeal processes,” according to the initiative’s text. The text does not specify what the requirements for an appeals process should be. Devins Baker said he has driven for Uber and Lyft in the Bay Area for eight years and was deactivated by Uber right before Christmas in 2024. He told CalMatters that he thinks Uber deactivated him after he had to brake hard to avoid hitting a person who darted across the freeway, causing his passenger — who was not wearing a seatbelt — to fall out of his seat. “I don’t know because we never find out which passenger complained,” Baker said, adding that he thinks some people report drivers to try to get a free ride from Uber. Baker got emotional during the news conference, saying he is trying to “keep it together” and is scrambling to find other ways to make money so he will not become homeless. Uber spokesperson Ramona Prieto called Liss-Riordan an “opportunistic trial lawyer” in an email to CalMatters and said the company will “fight this publicity stunt in court.” Prieto said the company provides drivers with a clear appeals process, and pointed to a company blog post from last week that explains what drivers can expect when they challenge deactivations.Another deactivated driver from the Bay Area, Mirwais Noory, said Uber kicked him off the app in November 2024 over what the company said were safety concerns. He said he tried to show Uber dashcam video to plead his case, to no avail. Getting deactivated caused financial hardship as he tries to support four children, he said. He has found work as a security guard since then, and now occasionally drives for Lyft.Jason Munderloh, chair of the Bay Area chapter of Rideshare Drivers United, said at the news conference: “Once they’re deactivated, there is no unemployment insurance . This leads to poverty and desperation.” “The minute someone joins RDU, their first concern is pay and the second is deactivations,” Nicole Moore, president of Rideshare Drivers United, told CalMatters ahead of the news conference. Uber, a multibillion-dollar company based in San Francisco, was the lead backer of the $205 million Prop. 22 campaign that was also funded by DoorDash, Lyft, Instacart and Postmates. Ubera total of $59.5 million in cash and in-kind contributions, and Postmates — which Uber bought in a deal that was completed in 2020 — spent $13.3 million. The lawsuit filed Monday in San Francisco Superior Court is the latest of many legal challenges against Prop. 22, which CalMatters has found The plaintiffs also allege Uber deactivates drivers based on grounds not specified in its “Platform Access Agreement,” and that the company does not provide drivers with enough information about their earnings to determine that they are receiving 120% of minimum wage.by the state Justice Department and the cities of San Francisco, Los Angeles and San Diego over thousands of wage-theft claims that predate Prop. 22. A trial-clock deadline for that lawsuit as well as a similar one against Lyft is set for December 2027.Kevin Warsh, President Donald Trump's nominee to serve as the next chair of the Federal Reserve, may face a tough fight for confirmation today — partly over events for which he has no control.The Senate Banking Committee is holding a confirmation hearing for Warsh today — but already one GOP senator has said he will block a vote on the nominee until the Department of Justice drops an investigation into the Fed.Warsh will likely face questions about inflation and borrowing costs and whether he can maintain his independence as Trump makes it clear he expects his next Fed chair to lead the charge to lower interest rates.of the Federal Reserve, may face a tough fight for confirmation — partly over events for which he has no control. The Senate Banking Committee holds a confirmation hearing for Warsh on Tuesday — but already one GOP senator has said he will block a vote on the nominee until the Department of Justice drops an investigation into the Fed. Warsh will also likely face questions about inflation and borrowing costs and whether he can maintain his independence as Trump makes it clear he expects his next Fed chair to lead the charge to lower interest rates.Most of the drama has nothing to do with Warsh himself A key member of the banking committee, Sen. Thom Tillis, R-N.C., has promised to hold up confirmation of the nominee, but not because of any objection to Warsh himself. Tillis wants the Justice Department to drop its criminal investigation of the central bank and its current chairman, Jerome Powell. That probe is ostensibly aboutThe DOJ has promised to appeal the judge's decision. By dropping its probe, the administration could win Tillis' vote and clear the way for Warsh's confirmation. But that hasn't happened yet.Kevin Warsh previously served on the Fed's board of governors and had a reputation as"hawkish," meaning he was cautious about cutting interest rates for fear inflation might get out of control. But recently, he's argued that productivity gains from artificial intelligence could allow the central bank to lower interest rates while still keeping prices in check. Critics like Sen. Elizabeth Warren, the ranking Democrat on the banking committee, see that flip-flop as a sign that Warsh will take direction on rates from President Trump, even though the Fed is supposed to operate free from political pressure. "Warsh has really gone out of his way to demonstrate that he will be the sock puppet in chief," Warren told NPR. While past presidents have given the Fed wide latitude, at least publicly, in setting interest rates, Trump has been outspoken in demanding lower rates, raising concern that he could jeopardize the Fed's independence. Even if Warsh wants to lower interest rates, he may not be able to. Interest rates are set by a 12-member committee at the Fed, and many committee members are reluctant to cut rates until inflation is closer to the central bank's 2% target. The war with Iran and the resulting spike in gasoline prices have made that a more challenging goal.If confirmed, Warsh could also seek to narrow the Fed's footprint in the economy. Warsh has criticized the Fed for straying beyond its statutory role of promoting stable prices and maximum employment. He's argued that the central bank should play a smaller role and that Fed leaders should talk less and stay in their lane. While he agrees that political leaders should keep hands off the Fed in setting interest rates, he argues the Fed should be equally cautious about stepping into muddy political waters aroundThe failures surround poor bookkeeping and accounting of taxpayer money at the agency — which spent over $800 million in public funds last fiscal year. The issues emerged despiteserious oversight problems in prior years. The latest audit was conducted by an outside firm hired by the agency to meet federal requirements.“Amounts initially included in the financial statements were not accurate, and adjustments were required,” auditors found in their review of LAHSA’s last fiscal year that ended in June 2025. The audit found that it stemmed from a"significant deficiency” in LAHSA’s “internal controls,” which are supposed to safeguard against financial inaccuracies and fraud.LAHSA officials have blown the March 31 federal deadline to turn in the audit after management missed multiple extensions in January and February to turn over financial documents to auditors for the fiscal year that ended last June. Missing the March 31 deadline can put future federal funding at risk. LAHSA officials said they hope to submit the final audit report this coming Friday, about 3 ½ weeks after the deadline.L.A. Mayor Karen Bass, who is the only elected official on LAHSA’s governing commission, did not respond to a request for comment through a spokesperson. At a public meeting Monday, LAHSA CEO Gita O’Neill told LAHSA’s audit committee that her team was working to implement a lot of the auditors’ suggestions.Auditors are flagging major problems with the handling of tax dollars by the L.A. Homeless Services Authority. The failures surround poor bookkeeping and accounting of taxpayer money at the agency — which spent over $800 million in public funds last fiscal year. The issues emerged despiteserious oversight problems in prior years. The latest audit was conducted by an outside firm hired by the agency to meet federal requirements. The agency’s financial statements initially included “significant” inaccurate amounts that needed to be adjusted late in the audit process,was presented to LAHSA’s audit committee on Monday. It found the inaccuracies stemmed from a"significant deficiency” in LAHSA’s “internal controls,” which are supposed to safeguard against financial inaccuracies and fraud. The accounting failures contributed to delays in completing the audit — which was due to the federal government on March 31 — according to the draft report. Missing that deadline can put future federal funding at risk. LAHSA officials said at the committee meeting that they hope to submit the final audit report this coming Friday, more than three weeks after the deadline. At a public meeting Monday, LAHSA CEO Gita O’Neill told LAHSA’s audit committee that her team was working to implement many of the auditors’ recommendations, which she called “great suggestions.” The draft audit report now goes to the LAHSA Commission for approval on Friday. The audit committee was asked to approve it Monday but didn’t have majority support to move forward. L.A. Mayor Karen Bass, who oversees the agency and is the only elected official on LAHSA’s governing commission, did not respond to a request for comment through a spokesperson.all of the county’s $300 million-plus in annual funding of services through LAHSA and instead have the county directly manage it starting on July 1. Problems identified in the latest audit reiterate why the county pulled its funding, Supervisor Kathryn Barger said in a statement Monday.In a statement, Supervisor Lindsey Horvath said the “significant financial problems” found in the audit give “further confirmation” why the county decided to shift its funds out of LAHSA. “Accountability isn’t optional; it is required to end this emergency. Anything less is unacceptable,” Horvath said. The city is considering moving in a similar direction as the county. A key City Council panel — its homelessness committee —the full council start shifting city homelessness funding out of LAHSA over the course of the next fiscal year. Bass has urged caution, saying moving too quickly to shift funding could disrupt services for unhoused people. LAHSA has long functioned as the L.A.’s homeless services department, with over $300 million in city money expected to flow through LAHSA this fiscal year. As of last summer, LAHSA had $380.5 million in assets and $381 million in liabilities, and received a total of $810 million in operating revenues during the last fiscal year,During Monday’s discussion, lead auditor Justin Measley said LAHSA did not disclose millions of dollars in payments to a service provider whose executive was married to LAHSA’s CEO at the time, Va Lecia Adams Kellum. The audit is required to list “related party” transactions, Measley said, which involve an organization with immediate family ties to LAHSA’s leadership. He said auditors only learned about it later through reviewing news media coverage.on a $2.1 million contract and two other contract amendments with Upward Bound House, the Santa Monica-based nonprofit where her husband Edward Kellum works in senior leadership. The contract named Adams Kellum as the LAHSA official authorized to administer it. Va Lecia Adams Kellum, former CEO of the Los Angeles Homeless Services Authority, at a news briefing at L.A. City Hall in June 2023.A LAHSA-commissioned investigation cleared Adams Kellum of wrongdoing in part because “her signature was unintentionally applied by her staff, not by herself,” according to a summary released by LAHSA. LAHSA spokesperson Paul Rubensteinfrom Adams Kellum’s official account to a colleague about one of the contracts with her husband’s employer, which stated “Please delete the document that I signed accidentally.” Last year, state investigators at the Fair Political Practices Commission launched a conflict of interest investigation into the matter, which is ongoing. Monday’s audit committee meeting also included discussion of the auditors’ findings that LAHSA is locked into paying $75 million for long-term leases over the coming years that cannot be canceled. Those leases are largely through its master leasing program that started over the last couple of years, which leases 14 apartment buildings, totaling 772 units, to provide housing for unhoused people. LAHSA management says the master leasing program is currently significantly underwater financially.A presentation last week by LAHSA management said the master leases are causing an annual budget hit of $10 million to LAHSA, which is prompting the agency to pull from other grants to pay for the leases. LAHSA’s lease accounting was at the center of a"significant” correction to the agency’s financial statements late in the audit process, the audit states in its findings. The auditors also found that LAHSA failed to comply with requirements for payroll costs that it charged to the federal government. The agency’s management failed to ensure timesheets for its employees were approved for three of the 40 timesheets the auditors reviewed, despite the law requiring federally-funded salaries to be based on accurate records of work, auditors found.If you're enjoying this article, you'll love our daily newsletter, The LA Report. Each weekday, catch up on the 5 most pressing stories to start your morning in 3 minutes or less.Los Angeles Mayor Karen Bass on Monday unveiled a $14.9 billion budget that is significantly rosier than last year’s spending plan, when she suggested massive layoffs and service cuts to accommodate a billion-dollar deficit.This year, because of a projected increase in revenues, the mayor is proposing no layoffs and a modest expansion of street services. The budget also calls for hiring police officers to keep up with retirements and resignations, maintaining Fire Department spending and holding steady funding for homelessness programs.In Bass’ proposal, the reserve fund is 5.7% of the general fund, or $490 million. The budget does not dip into the reserves, in contrast to last year’s plan.Bass is seeking re-election this year, and several of her challengers criticized the budget. “The budget the Mayor released today tells us the plan is to largely keep doing what we're doing — but what we're doing is not working,” Councilmember Nithya Raman said in a statement.Los Angeles Mayor Karen Bass on Monday unveiled a $14.9 billion budget that is significantly rosier than last year’s spending plan, when she suggested massive layoffs and service cuts to accommodate a billion-dollar deficit. This year, because of a projected increase in revenues, the mayor is proposing no layoffs and a modest expansion of street services. Bass' budget also calls for hiring police officers to keep up with retirements and resignations, maintaining Fire Department spending and holding steady funding for homelessness programs. “This budget is about protecting the progress we have made and making clear that Los Angeles is moving forward and will not go backward,” Bass said at a news conference. In the proposal, the reserve fund is 5.7% of the general fund, or $490 million. The budget does not dip into the reserves, in contrast to last year’s plan.Some of her challengers in the upcoming election, including Councilmember Nithya Raman, criticized Bass’ proposal as doing little more than maintaining the status quo. “The budget the Mayor released today tells us the plan is to largely keep doing what we're doing — but what we're doing is not working,” Raman said in a statement. Next, the proposal will go to the City Council for consideration. Budget hearings will be conducted in the coming weeks.Among the reasons city officials say revenue will go up is the expected influx of thousands of visitors to World Cup soccer matches this summer. More travelers mean more people staying in hotels and paying hotel taxes, as well as more sales tax revenue. The budget projects a $412 million increase in general tax revenue, including $71 in business taxes, $34 million in sales taxes and $67 million in utility taxes. The budget would add 170 new positions in the department that handles street repairs and increase funding for street and sidewalk fixes, curb-ramp installation, street sweeping, bulky item pickup and dedicated illegal dumping enforcement throughout the city. The budget also proposes hiring 510 police officers, representing a target of 8,555 for the Police Department and enough to keep up with attrition, according to budget officials. Bass has set a goal of 9,500 officers.That proposal is likely to see opposition from some council members who want to see the department shrink and funding for unarmed response teams increase.The budget sustains citywide coverage for civilian unarmed crisis response, maintaining deployment of 500 crossing guards and expanding a program that aims to help children get to and from school safely and protect them from gang violence. Under the budget, funding for Inside Safe, the mayor’s signature program to address homelessness, would remain about the same — $104 million.The budget maintains funding for the city Fire Department. In November, voters are expected to decide whether to increase the sales tax by half a percent to pay for more firefighters and equipment.“This budget maintains a status quo of reduced services and higher fees, the direct result of fiscally irresponsible decisions made by this Mayor in prior years,” Raman said in her statement.Adam Miller, a tech entrepreneur and another Bass challenger, said keeping the budget flat “implies that the status quo is working.” “That is tone-deaf to the city of Los Angeles as Angelenos overwhelmingly feel we need change," he said. The budget needs to be approved by the City Council and signed by the mayor by July 1, the start of the fiscal year.LAHSA workers observe L.A. city sanitation workers removing a houseless encampment during a sweep of an encampment in Venice Beach.The L.A. Homeless Services Authority announced Monday that the agency will narrow its focus and lay off 284 employees at the end of June.LAHSA interim CEO Gita O’Neill called the staffing changes a “necessary evolution," according to a news release announcing the move. “By narrowing our focus to macro-level governance, data management, and securing federal funding, we are stepping into our true role as a strategic architect of the region’s homelessness response system.” In December, a group of LAHSA employeesThe agency will send layoff notices to the 284 employees on April 30, according to the news release. Another 130 positions that are currently vacant will also be eliminated in the transition. Some of the layoffs may be avoided, a LAHSA spokesperson said in the news release, “depending on the final details of the City of Los Angeles budget.” "I want to profoundly thank our staff for their unwavering dedication and hard work serving people experiencing homelessness across Los Angeles County," O’Neill said."Our staff has been the driving force behind the historic reductions in street homelessness we've seen over the past two years.”
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