Uber and Lyft have threatened to shut down their operations in California, one of the rideshare companies’ largest markets, if the court does not lift an order requiring the two companies to classify their drivers as employees, and not freelancers/contractors.
If so, they plan to keep cars off the road until at least November, when voters weigh in on Proposition 22, their ballot initiative to keep their workers as independent contractors.
However, the company is not planning to halt operations for its delivery service, Eats, because the lawsuit did not specify drivers for that platform.
Uber’s delivery orders have more than doubled in the second quarter, with Americans relying on deliveries to avoid exposure to the coronavirus during the pandemic. At the same time, ride-hailing trips have taken a significant hit, down 75% from last year.
The company said it is weighing a shift to a franchise model in California, where employment would be left to independent franchisees rather than Uber’s corporate headquarters.
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