At issue is the classification of ride-hailing drivers as independent contractors, which Uber and Lyft say most drivers prefer because of the flexibility and ability to set their own hours. This time around. All rights reserved. All content of the Dow Jones branded indices Copyright S&P Dow Jones Indices LLC 2018 and/or its affiliates. Uber and Lyft have both built up massive fleets of drivers by treating them as independent contractors. Uber said it's appealing the decision. The company is appealing a court decision that would define its drivers as full-time employees. Under AB-5, which went into effect January 1, companies must prove workers are free from company control and perform work outside the usual course of the company's business in order to classify workers as independent contractors rather than employees. Khosrowshahi made his comments in a television interview Wednesday on … “If the court doesn’t reconsider, then in California, it’s hard to believe we’ll be able to switch our model to full-time employment quickly,” he told MSNBC. The businesses’ exit from the Golden State will leave hundreds of thousands of drivers unemployed and millions of Californians chasing an expensive cab. Legal ruling averts Uber and Lyft shutdown in California. SAN FRANCISCO — Uber and Lyft will continue operating in California after an appeals court issued a stay on an order that would have prompted the ride-hailing companies to shut down. Inside the decision that's still rattling the movie industry to its core, Tucker Carlson claims vaccine campaign 'feels false, because it is', How the vaccine gets from the lab to your arm, McDonald's is putting cameras in dumpsters. Both companies have said they would appeal the ruling, which was stayed for 10 days. But if their appeal fails, Uber may have to close up shop in California, Khosrowshahi said. The New York Times reported earlier this week that while pushing their November ballot initiative, the companies are also considering their other options, including exploring a franchise-like model where they would not employ drivers directly but would instead potentially license their name to fleet operators in the state. The ride-hailing giant is currently appealing against a Supreme Court judgment in the state that requires the company to recognise its drivers as employees and give them employment protections as a result. Uber and Lyft have just over a week left to appeal the injunction. That won’t happen due to a new legal development, but they’re still operating under huge uncertainty. The flurry of lawsuits and court rulings in California comes ahead of the November election, when the state’s voters will decide on an Uber and Lyft-backed ballot measure that would override AB5 by classifying ride-hail drivers and other gig economy workers as independent contractors. SAN FRANCISCO (KRON) – Uber says it will likely be forced to shut down operations in California for several months if it is required to classify drivers as full-time employees. In May, California Attorney General Xavier Becerra, along with city attorneys of Los Angeles, San Francisco, and San Diego, sued Uber and Lyft, arguing that their drivers were misclassified as independent contractors when they should be employees under the state’s AB5 law that went into effect on January 1st. Uber and Lyft get temporary reprieve from California court, 'What are we supposed to do? It accounted for 9% of Uber's worldwide rides before the pandemic caused people to avoid traveling. 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