Rideshare driver Jesus Jacobo Zepeda of Lancaster, California takes part in a rally as part of a statewide day of action to demand that ride-hailing companies Uber and Lyft follow California law and grant drivers “basic employee rights”, in Los Angeles, California, U.S., August 20, 2020. REUTERS/Mike Blake


A California appeals court granted rideshare companies Uber and Lyft an extension to comply with new state law, averting a statewide shutdown of the services Thursday. Both companies previously threatened to cut off service at midnight Thursday if the original deadline was kept in place. The court will now hear oral arguments starting October 13. 

The companies can continue to operate while they contest the lawsuit brought forth by the State of California in May, which alleged the companies were not following labor law Assembly Bill No.5. The law, enacted in January, requires the companies to classify their independent contractors as employees and therefore provide minimum wage and benefits. Proposition 22, on the ballot in November, would give Lyft, Uber, and DoorDash an exemption to AB5. If the proposition fails and the stay is still in place, the companies would have to comply within 30 days.

Uber and Lyft argue that drivers would lose work and wages under the new classification. Additionally, they alleged that drivers were not a core part of their business because the companies are tech companies, not driving companies. State officials said that neither company contributes to the state’s unemployment insurance fund on behalf of their drivers, and therefore they cause harm to more than their own drivers. Both companies are exploring options for the employment of contractors, including franchise opportunities. Should Uber be forced to comply, the ruling could have a huge impact on the company, which recently made an offer to buy Postmates in July.

Drivers protested the decision in Los Angeles at LAX and San Francisco at Uber’s headquarters on Thursday, demanding the companies abide by AB5. One driver compared Uber to “a big giant baby.” President Trump’s campaign issued a statement supporting the companies, noting that both former Vice President Joe Biden and Sen. Kamala Harris, D-Calif., voiced their support of the law in the past.


Lyft, Uber Get Last-Minute Reprieve Before They Would Have Canceled Services in California – Reason – 8/20/2020
Rideshare services Lyft and Uber—and more importantly their freelance drivers and customers—dodged a bullet today as a judge decided to allow to companies to continue classifying their drivers as independent contractors while a court battle wages on. […] Uber officials had warned that complying with the law would drive costs up so much that consumers could end up paying as much as 111 percent more for rides in some places. In a blog post from Lyft today explaining they’d be shutting down, they said the changes would result in 80 percent of their drivers losing work in California and passengers seeing reduced services in suburban and rural areas.

Uber and Lyft had time to comply with the law. They did not. – Engadget – 8/21/2020
The appeals process could go on for months, as both Uber and Lyft attempt to buy more time. The truth is, however, both companies have had nothing but time to comply with the law. The fact that they fought back, stalled, made excuses and are funding a ballot proposition that would undo worker rights, is a sign that these companies have no intention of following the rules or giving their drivers the benefits they deserve. They had their time, but they squandered it. 

Prop 22 Trying To Save App-Based Rideshare & Delivery Services In California – Android Headlines – 8/21/2020
The aforementioned legislation is aiming to eliminate the ability of Californians to work as independent contractors with app-based rideshare, food, and grocery delivery platforms. It aims to force them to be classified as employees if they want to continue their employment. Now, such legislation would basically eliminate hundreds of thousands of jobs and result in various other issues. […] Prop 22 aka Proposition 22 is aiming to protect the flexibility and independence that rideshare and delivers drivers prefer. It also aims to implement additional customer and public safety protections.

Protesting Drivers Unveil Big Inflatable Diaped-Up Baby Outside Uber HQ – Vice – 8/21/2020
On Thursday, a coalition of app-based drivers and driver advocacy groups in California led a statewide day of action, including a caravan protest that brought a giant inflatable baby to Uber’s San Francisco headquarters. The protest—organized by We Drive Progress, Gig Workers Rising, and Rideshare Drivers United—occurred in the hours after Lyft announced it would suspend operations Thursday night before backtracking when an appellate court granted a delay to Uber and Lyft in enforcing a judge’s order that they must classify drivers as employees, so the companies can appeal it.


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