A California appeals court says Uber and Lyft must classify their drivers as employees rather than independent contractors, siding with a lower court that found the ride-hailing companies were likely violating state labor law.
The ruling is a blow to Uber and Lyft, which argue that the law does not apply to them. Both companies previously threatened to leave the state if forced to make their drivers employees.
But there’s time, because the California law remains effectively on hold for Lyft and Uber. The appeals court on Thursday ordered the ride-sharing companies to reclassify drivers, but not for at least 30 days after the case is sent back to the trial court. Before then, the companies can appeal to the California Supreme Court.
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