Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Case lawUSAEmployment lawLatest NewsGig economy

Uber and Lyft granted reprieve in California employment row

by Adam McCulloch 19 Aug 2020
by Adam McCulloch 19 Aug 2020 Photo: Shutterstock
Photo: Shutterstock

Ride-hailing companies Uber and Lyft will continue to operate in California after a court granted an emergency injunction. 

Earlier this week, the cab companies had threatened to suspend their taxi services in California over a ruling that they must classify drivers as employees rather than self-employed contractors.

The threat hinged on whether a state judge would allow them an appeal or more time to reclassify their drivers from contractors to employees, as has been required by law since the passing of Assembly Bill 5 (AB 5) January.

Lyft was due to stop its services in California at 23:59 local time on Thursday 20 August – the reprieve, issued just hours before, will allow the companies to continue operating while the court considers the appeal.

The court has ordered the companies to submit plans for hiring employees by September, while oral arguments for the case are due to be heard in October.

On 10 August the San Francisco Superior Court granted a preliminary injunction that would require Uber and Lyft to reclassify drivers as employees because the companies had not complied with AB 5. The gig economy operators had 10 days to file an appeal before the injunction becomes effective on 20 August.

If an appeal is not allowed or no ruling is made on one, the taxi services said they would cease operations in California until they had the systems in place to employ drivers. Both companies have claimed they are not ready for the switch.

Uber UK employment status case

UK Supreme Court to make final Uber ruling

California sues Uber and Lyft over driver benefits

Court confirms Uber drivers’ status in France as employees

Six employment law cases that will shape 2020

Uber drivers are workers, Court of Appeal rules

Uber and Lyft are backing Proposition 22 (a kind of referendum that can be brought about by writing a proposed law as a petition, and submitting it to the California attorney general), a ballot being held on 3 November that would give California voters a chance to decide the status of the firms’ workers.

If the proposition is passed the companies say they would improve working conditions for drivers who would retain their status as contractors. It is thought that a shutdown may inconvenience some voters enough to sway them and affect the outcome.

A shutdown would not greatly damage the companies any further financially because both are said to be losing money during the coronavirus pandemic.

However, Uber and Lyft drivers around the US have suffered financial hardship and have had to either continue working with fewer customers or rely on unemployment benefits from state systems that have struggled to keep up with backlogs and pay out full benefits.

A report conducted by the UC Berkeley Labor Center in May 2020 found Uber and Lyft would have paid $413m into California’s unemployment benefits system if drivers had been classified as employees rather than independent contractors.

California is among many US states struggling to maintain funds for unemployment insurance funds.

Uber and Lyft’s threats have not impressed employment campaigners in the US. Rebecca Smith, director of the work structures portfolio at the National Employment Law Project, said the mooted shutdown “puts the lie to any concern [Uber] claims to have about job loss and worker well-being – it is saying it will lay off tens of thousands of workers unless judges and voters give it what it wants”.

The companies have also been accused of trying to buy their way out of legal rulings: their campaigns to overturn AB 5 in support of Proposition 22 are said to have cost each firm at least $30m.

Many of the firms’ drivers reject Uber and Lyft’s claims that they are independent contractors, citing the lack of control drivers over per-mile pay rates and the practice of charging passengers more when demand for rides is high, without passing any of the proceeds to drivers.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

This story was updated on 21 August to reflect the emergency injunction. 

Latest HR job opportunities on Personnel Today

Browse more human resources jobs

Uber
Adam McCulloch

Adam McCulloch first worked for Personnel Today magazine in the early 1990s as a sub editor. He rejoined Personnel Today as a writer in 2017, covering all aspects of HR but with a special interest in diversity, social mobility and industrial relations. He has ventured beyond the HR realm to work as a freelance writer and production editor in sectors including travel (The Guardian), aviation (Flight International), agriculture (Farmers' Weekly), music (Jazzwise), theatre (The Stage) and social work (Community Care). He is also the author of KentWalksNearLondon. Adam first became interested in industrial relations after witnessing an exchange between Arthur Scargill and National Coal Board chairman Ian McGregor in 1984, while working as a temp in facilities at the NCB, carrying extra chairs into a conference room!

previous post
Pizza Express latest to announce significant redundancies
next post
Covid-19 ‘an opportunity’ for occupational health to demonstrate its value

You may also like

How can businesses build protections for gig workers?

7 May 2025

Uber drivers experience ‘false autonomy’ over work

16 Apr 2025

Home Office reveals employers’ costly right-to-work mistakes

7 Apr 2025

New right to work checks put onus on...

3 Apr 2025

Close loopholes that let rogue firms undercut best...

3 Mar 2025

‘Freelance’ apps warned they could be breaking law

28 Jan 2025

Deliveroo, Just Eat and Uber face calls for...

20 Jan 2025

Bolt drivers win worker status at tribunal

8 Nov 2024

McDonald’s accused of threatening Uber Eats drivers

28 Oct 2024

Lib Dems unveil 2024 election manifesto

10 Jun 2024

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+