App-Based Drivers vs. AB5: Temporary Stay Granted
By Kevin Cleveland
Today, a California Appeals Court judge granted Uber and Lyft’s request for an emergency stay from the lower court’s order that Uber and Lyft would have to start treating drivers in CA as employees instead of independent contractors. Following the lower court’s ruling Uber and Lyft threatened to stop services in CA if their request for an emergency stay was not granted. For now, App-based ride-sharing will continue in CA. Whether app-based drivers will be considered employees or fall under their own classification will ultimately be decided in November based on whether Prop 22 is or is not passed by CA voters. Prop 22 if passed will not classify app-based drivers as employees but will still make them certain guarantees and promise them certain benefits.
Unfortunately for many businesses and independent contractors, Prop 22 only addresses app-based drivers and does not do anything for the tens of thousands of other independent contractors who were reclassified as “employees” under AB5. The consequences of AB5 passing have been significant as multiple exceptions had to quickly be made to the law to prevent CA’s economy from being crippled. Similarly, many workers became employees overnight and lost much of the freedom and independence to work for themselves which they enjoyed before the passage of AB5.
The next major development, in this case, will be when arguments are heard by the California Court of Appeal on October 13, 2020.