There had been a court ruling in the city of California on Thursday after a state appeals court ruled in the favor regarding an injunction against two of the poplar ride-hailing services Lyft and Uber.
This was based on the city effecting the companies regard it’s drivers as employees which the city had assumed was a way of the companies not paying the benefits which the workers were entitled to. But despite the ruling, there had been numerous rumors swirling around the internet concerning the ruling as to whether Uber and Lyft will suspend their operations in California but this happens to be false.
“While we won’t have to suspend operations tonight, we do need to continue fighting for independence plus benefits for drivers,” said Lyft spokeswoman Julie Wood.
Based on a post written on Lyft’s blog, the company urged the people in California to support a ballot measure which the companies are backing called “Proposition 22” which is aimed to keep drivers as independent contractors.
In all, Uber and Lyft — along with Doordash, Postmates and Instacart — have put $110 million behind the measure. The proposition is up for vote in California in November.
Earlier in the day, Lyft said it was prepared to shut down in the state, likely its largest market.
“As a result of a court order, we’ll be suspending rideshare throughout California at 11:59 PM PT on Thursday, August 20,” the company said in an update on its website. “We did everything we could to prevent this from happening and keep Lyft available for you, but it wasn’t possible to overhaul our business model and operations in ten days.”
The ruling from Judge Ethan Schulman of the the San Francisco Superior Court ruled back in August 10th that the ride-hailing services start classifying it’s drivers as employees in the state instead of contractors. This injunction wasn’t forced for 10 days in order for them to file an appeal regarding the case.
This also stemmed from a lawsuit up against both Uber and Lyft back in May by the state of California which stated that the companies “exploited hundreds of thousands of California workers” as it classifies its drivers as independent contractors and also violating the California’s AB5 law on worker classification which took effect back in January.
Hundreds of drivers in the state have been rallying to be classified as employees by the companies. On Thursday, several drivers groups planned a protest in front of Uber’s headquarters in downtown San Francisco demanding the companies abide by AB5.
The companies had both threatened to halt their operations in the state if forced to reclassify stating it will affect the entire business structuring from the start. But as it is now, both Uber and Lyft will not be halting their services at least for the foreseeable future as oral arguments in the case are scheduled for Oct. 13.