Court rules Uber, Lyft must reclassify drivers

Uber and Lyft have to reclassify their drivers as employees, an appeals court in California has ruled.

Preetika Rana reported the news for the Wall Street Journal:

Uber Technologies Inc. and Lyft Inc. must comply with an order that requires them to reclassify their drivers as employees, a California appeals court said Thursday, siding with a lower-court ruling from August that threatened to upend the companies’ business models.

CNN’s Sara Ashley O’Brien wrote:

The ruling marks a significant development in a months-long legal fight between the companies and the state of California, which in May sued Uber and Lyft and claimed they were in violation of state law. It also puts greater pressure on the companies to successfully pass their California ballot measure which seeks to exempt them from the law.

Shannon Bond from NPR noted:

In the meantime, California voters may decide on the law’s future because it’s on the November ballot. A measure backed by the companies, Proposition 22, would allow ride-hailing and food delivery apps to keep their drivers as independent contractors, while giving them limited benefits but not the full protections of employment status.