Uber and Lyft want to force their employees to formalize


Companies see this as a threat to their business model.


Uber and Lyft want to force employees to release. Photo:

California officials want to force taxi services Uber and Lyft to register their drivers as employees.

In May, California Attorney General Javier Becerra, along with city attorneys in Los Angeles, San Francisco and San Diego, sued Uber and Lyft. The lawsuit claims that at the moment, taxi drivers work as independent contractors, but state law requires them to be at par with the company’s employees.

Now Javier Bakerra plans to file an initial injunction that will force taxi services to be renewed to drivers in the coming weeks. The motivation of the Prosecutor General is insecurity of workers.

“Californians who work for Uber and Lyft cannot protect their labor rights. Sometimes it takes an epidemic to push us to understand what it really means and who suffers the consequences,” Becerra said.

Law AB 5 (Assembly Bill 5) signed on September 18, 2019 prescribes the so-called “ABC test”, which determines whether the employee is a contractor or an employee. Legal experts agree that the law will complicate the work of representatives of Gigonomics such as Uber, Lyft and DoorDash. The companies themselves argued that the law is a threat to their business model. Eventually, after registering drivers and couriers as full employees, firms must pay them insurance, maternity leave and other social guarantees. Uber and Lyft say that if Becerra succeeds in court, hundreds of thousands of drivers may be left without work, and the cost of the company’s services will rise.

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In 2019, the New York Taxi Driver Alliance filed a lawsuit against Uber Taxi Service, accusing the company of imposing sales tax and 2.5% insurance premiums on more than 96,000 New York drivers. Thus, from 2013 to 2017, the company paid taxes, cutting staff incomes.

Read: Gig Economy: What is a Free Earning Economy

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