Uber and Lyft call California’s bluff over driver employment status

The state of California is trying to force ride-hailing companies to treat their drivers as permanent employees, but they would rather shut down.

The law in question is called Assembly Bill 5 (AB5), which apparently prohibits ride-hailing firms Uber and Lyft from classifying their drivers as independent contractors. Instead it wants to ensure said drivers get all the perks and benefits that come with being a full employee, which would significantly increase the cost of using them and, in turn, increase the cost of using the services.

Uber and Lyft don’t seem to have published any formal statements on the matter, instead choosing to litter their press sites and company blogs with the now customary pandering and corporate virtue signalling. However they have taken the opportunity to make their positions clear through other channels as reported by the Verge.

In the clip below, Uber CEO Dara Khosrowshahi makes the point that its California drivers already have a lot of flexibility about what they can charge and that it’s especially counter-productive of the state to force this issue at a time of unprecedented unemployment. He and his counterpart at Lyft have said the move will force them to suspend operations in the state until Prop 22 is voted on by Californian residents in November.

While its easy for feel for gig economy workers due to their lack of benefits and job security, they’re essentially in the same position as all other contractors who knowingly exchange security for flexibility. Nobody has a gun to Uber and Lyft drivers’ heads and they’re free to seek salaried work if they choose. The painfully woke Californian legislature has essentially decided to ban casual labour and the real losers will be workers deprived of an easy revenue stream and consumers denied a cheaper alternative to taxis.