When it comes to ride-sharing startups, Uber and Lyft dominate this industry for sure. However, they face various problems, including various state attorneys. Now according to recent reports, California has ordered Uber and Lyft to consider their drivers as the employees of the company. A California Attorney general a few days ago filed in the court petition stating these companies are not treating drivers as part of the company’s employees instead of labeling them as “independent contractors.” State attorneys are defending this fact on the state’s AB5 law, and it seems like Uber and Lyft might not have any chance of defending.
California is taking quite severe actions against those companies which are violating the labor laws. The state is probably going to order Uber and Lyft in upcoming weeks about reconsidering these drivers as employees within the company. The state attorney said these drivers who drive for Uber and Lyft no less than employees who are not receiving the required benefits during a pandemic situation.
They even said it’s the situation like a pandemic that forces us to think about vulnerable employees. AB5 is the new law that comes with the definition of whether someone is an employee of the company or not, and it will become harder for big companies like Uber, Lyft to defend themselves. Uber and Lyft, on the other hand, are defending their existing business model by blaming the state government for shutting their operation in California. These companies think there will be massive consequences for his legal action on those working in California and earning money through their services.
Executives said the current situation is not to bring in new laws but to focus on creating more jobs. More than 3 million Californians are out of work, and these ride-sharing companies are giving the required employment to them based on independent contracts.
