Dara khosrowshahi, Uber’s chief executive, said today that the company’s California service could be temporarily shut down for several months if the court does not reverse a recent ruling “requiring Uber to classify drivers as full-time employees.”. On Monday, a judge in California ruled that Uber and LYFT are not allowed to treat drivers on their platforms as “contract workers” locally, but as “regular employees” who can enjoy company benefits.
in response, kosrossasi said in a media interview today that if the court does not reverse the ruling, our services in California may be temporarily closed for several months. “If the court does not reconsider the ruling, it will be very difficult for us to quickly convert current drivers to full-time employees in California,” he said
if the appeal is dismissed, Uber can only count on voters’ votes on proposal 22, which exempts drivers from app based transportation and delivery companies from being considered employees. If the court’s ruling still needs to be enforced, it means Uber and LYFT need to provide various benefits and unemployment insurance for drivers.
in May, California Attorney General Xavier Becerra and city prosecutors in Los Angeles, San Diego and San Francisco filed lawsuits against Uber and LYFT, accusing them of violating California’s new law requiring drivers to be classified as regular employees.
on Monday, Uber CEO kosrosasi offered another solution, bypassing the terms of “contract workers” and “regular employees.”. He suggests that companies that rely on the “casual economy” set up welfare funds that workers can use for everything from health insurance to paid leave.
the amount that workers can withdraw from the fund will be based on the length of work they have invested. Since all odd economy companies have to pay for the fund, workers can accumulate benefits even if they switch between apps they use to make money.
kosrossasi also stressed today that if services were suspended in California, thousands of drivers would lose their usual income from Uber. And the judge said that Uber and LYFT’s passenger volume had been declining during the outbreak, which may be the “best time” for the two companies to adjust their business models.
California Attorney General Bessel also said yesterday that he was not worried about the possible consequences of Uber’s departure from California. “A business model that makes money by squeezing workers doesn’t work anywhere, including California,” he said Chinese version of K-car: reading a10e design drawing exposure