In a notable court ruling in the United States, a judge in California has ruled that the two rivaling ride hailing companies Uber and Lyft will now have to classify their drivers as employees and not treat them as mere freelancers.
The court gave the two companies a period 10 days to file an appeal against the judgment and to appeal against a preliminary injunction.
The status of drivers of these two companies has been a cause of controversy for quite some time now. Companies in the gig economy claim that treating drivers as freelancers means that drivers would be able to work on their own terms. However critics of this classification of drivers of the companies have argued that this was done deliberately by the companies to avoid providing the drivers any pf the facilities that they would have otherwise been forced to if they were classified as employees.
Works in the gig economy have been granted entitlement to holiday and sick pay under a new rule that has been enacted in California called Assembly B5. The new law was implemented starting January 1 and sets out three criteria for classifying whether a worker is an independent freelancer or whether he or she is an employee working in the gig economy.
These criteria can b found on the California state government website in the form of a list. They include a consideration about whether the entity hiring such workers can have or possess direct control over their activities and can direct the workers in terms of their performance. It also includes the consideration of whether the job that is offered to such workers in the gig economy is different from the core line of work of the hiring entity.
They should not be considered “hiring entities”, Uber and Lyft had argued.
But disagreeing with the two companies, Judge Ethan Schulman said that this contradicted the claims that the two companies had made elsewhere.
“Defendants may not evade legislative mandates merely because their businesses are so large that they affect the lives of many thousands of people,” he wrote.
“The vast majority of drivers want to work independently, and we’ve already made significant changes to our app to ensure that remains the case under California law,” said an Uber spokeswoman.
Drivers “do not want to be employees”, Lyft said.
The status of app-based drivers is set to be put to the vote in a referendum in California in November.
The ruling was described as “a resounding victory” for drivers by Mike Feuer, Los Angeles City Attorney.
(Adapted from BBC.com)