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Monday, September 21, 2020

Shutdown of Commercial Transportation in California- Uber and Lyft

On August 20th, 2020 a California appeals court judge blocked an order for Uber and Lyft to classify drivers as employees which as volition of AB5 Bill. This prevented an expected shutdown of the cab sharing services in California at midnight. The court then granted the companies a temporary stay while their appeals process develop.

Uber and Lyft are under huge pressure to alter their business models in California. Both companies were founded and gained million dollars in venture capital, California. Uber and Lyft urge that the drivers prefer flexibility of working as freelancers, while labor unions and elected officials claim this deprives them of traditional benefits like the health insurance, overtime pay, paid sick leave, and unemployment insurance.

But the companies won an 11th hour remission from the California Court of Appeals hours before the expected shutdown. The companies will now have until October to convince the court to banish the order that it employ its drivers. If they are unable to do so, the may again decide to shutdown.

 

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