Why? It all has to do with a lawsuit that the state of California brought against Uber and Lyft back in May, stating that the companies violated California law by classifying their drivers as independent contractors and not employees. Last week on Aug. 10, Judge Ethan Schulman of the San Francisco Superior Court ruled that the companies must reclassify their drivers as employees and gave them 10 days to appeal, which they did.
The injunction is now in the hands of a state Court of Appeals — Lyft’s statement said they would suspend operations only if the court did not rule in their favor by midnight Thursday. If Uber and Lyft were to classify their drivers as employees, it would mean they would have to provide the drivers with benefits such as health insurance, paid sick leave and minimum wage. As independent contractors, drivers are not currently eligible for these kinds of benefits.
Read Lyft’s full announcement here.
