Good news for all those Uber and Lyft customers who thought they would have to begin begging for rides from friends - a state appeals court has granted an emergency stay that will prevent a shutdown of Uber and Lyft service that was set to begin at midnight across California.
In a blog post Thursday morning, Lyft announced it was suspending ridesharing operations in California at 11:59 p.m. PT tonight following a decision by a San Francisco judge last week that granted a preliminary injunction requiring the ridesharing companies to reclassify its drivers as employees instead of independent contractors.
Uber had also threatened to suspend service in California, but they not yet made a formal announcement before the emergency stay was granted.
"This is not something we wanted to do, as we know millions of Californians depend on Lyft for daily, essential trips,'' according to the blog post on the company's website. ``For multiple years, we've been advocating for a path to offer benefits to drivers who use the Lyft platform -- including a minimum earnings guarantee and a healthcare subsidy -- while maintaining the flexibility and control that independent contractors enjoy. This is something drivers have told us over and over again that they want.
"Instead, what Sacramento politicians are pushing is an employment model that 4 out of 5 drivers don't support. This change would also necessitate an overhaul of the entire business model -- it's not a switch that can be flipped overnight.''
The injunction was part of a lawsuit filed by three city attorneys, including Los Angeles City Attorney Mike Feuer, and California Attorney General Xavier Becerra, that claimed Uber and Lyft were incorrectly classifying its drivers as independent contractors, rather than as employees. A new state labor law, Assembly Bill 5 (AB5) provided new labor standards for gig workers which the judge said the ridesharing companies had failed to meet one of the key standards required by AB 5.
Ridesharing companies are trying to strike back with a new ballot proposition they're supporting in November. Proposition 22 would provide exemptions for companies like Uber, Lyft and other food delivery services.
Lyft says customers can still use their app for bike, scooter and car rentals.
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