Uber and Lyft must now classify their California drivers as employees instead of independent contractors. This then guarantees benefits like overtime, sick leave, and expense reimbursement.
San Francisco Superior Court Judge Ethan P. Schulman made the ruling on Monday, but according to Fox Business, “it might not take effect for some time, as Uber and Lyft immediately said they’d appeal to a higher court.”
Lawyers for the two companies argued that drivers do not serve as fundamental parts of the business. They also say this because the companies consider themselves as “multi-sided platforms” whose activities comprise more than transportation.
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A California judge ruled Monday that Uber and Lyft must classify their drivers as employees, not independent contractors. The judge accused the companies of using "circular reasoning" by only treating tech workers, not drivers, as employees.https://t.co/2Xm6kqzsPX via @NPR
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Schulman rejected those arguments, saying the argument “flies in the face of economic reality and common sense.”
“To state the obvious, drivers are central, not tangential, to Uber and Lyft’s entire ride-hailing business,” Schulman also said.
Fox Business reported that the apps claimed that the decision “threatens to shut them down during the economic downturn witnessed during the coronavirus pandemic when many people who have lost their jobs have become Uber and Lyft drivers.”
“Drivers do not want to be employees, full stop. We’ll immediately appeal this ruling and continue to fight for their independence. Ultimately, we believe this issue will be decided by California voters and that they will side with drivers,” said Lyft spokesperson Julie Wood to Business Insider.