Lyft & Uber Say They’ll Suspend Business In California If State Requires Them To Classify Drivers As Employees

After a California judge granted a preliminary order prohibiting Lyft and Uber from classifying their drivers as independent contractors instead of employees, the ride-share companies are threatening to leave the state altogether.

“If our efforts here are not successful, it would force us to suspend operations in California,” Lyft Presiden John Zimmer said Wednesday. “Fortunately, California voters can make their voices heard by voting yes on Prop 22 in November.”

Lyft, Uber, Doordash, Instacart, and Postmates are now funding Proposition 22, a ballot measure that would make gig workers exempt from Assembly Bill 5, Bossip reports. The new state law determines whether or not workers should be classified as an employee or contractor.

Employment status would allow ride-share drivers to receive benefits such as overtime and sick pay. The companies insist though that their drivers prefer their contractor status because it affords them more flexibility.

“If the court doesn’t reconsider, then in California, it’s hard to believe we’ll be able to switch our model to full-time employment quickly,” the CEO of Uber, Dara Khosrowshah, told MSNBC on Wednesday. The companies were given 10 days to appeal the ruling before it officially goes into effect.