A California judge ruled that Uber and Lyft have to classify their drivers as employees, not contractors
that Uber and Lyft owe more than $1.3 billion in payments to drivers in California pursuant to AB5.
The two companies are expected to appeal the ruling, which they said would put a strain on their revenue and potentially force them to shut down their apps in the state. San Francisco Superior Court Judge Ethan Schulman paused the injunction on Monday's ruling for 10 days to give the companies time to appeal.
Uber has publicly acknowledged that drivers suffer from a lack of benefits, but asserts that drivers benefit from the flexibility afforded by independent contractor status. Uber CEO Dara Khosrowshahi argued in a Monday that lawmakers should require gig work employers to provide some benefits to workers, but not the full benefits associated with full-time employees.. "It forces every worker to choose between being an employee with more benefits but less flexibility, or an independent contractor with more flexibility but almost no safety net."Axel Springer, Insider Inc.'s parent company, is an investor in Uber.
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