The
case is part of a battle over the future of the so-called gig
economy in California. In January, the state implemented a law
making it harder for ride-hail, food delivery and other
app-based companies to classify workers as independent
contractors.
While state law gives the appeals court 90 days to issue a
ruling, a decision on the future of gig work will likely be made
by California's voters on Nov. 3 instead.
Uber, Lyft, DoorDash, InstaCart and Postmates have collectively
spent more than $184 million to write and support a ballot
measure that would overturn the state gig worker law, also known
as AB5.
In May, California and the cities of Los Angeles, San Diego and
San Francisco sued Uber and Lyft for allegedly violating AB5 by
refusing to reclassify drivers. A California judge in August
ordered the companies to reclassify their drivers as employees
within 10 days.
That ruling was put on hold when the companies, under the threat
of leaving the state altogether, appealed the decision.
During Tuesday's nearly two-hour hearing before California's 1st
District Court of Appeal, Uber's and Lyft's lawyers told the
three-judge panel the lower court had ignored their evidence and
ruled in the state's favor based on faulty assumptions.
The attorneys said the law would cause irreparable harm to the
state and its residents, with the companies forced to overhaul
their business models and cut thousands of part-time drivers
from their platform.
A lawyer for the state and cities said harm was already caused
to misclassified drivers and other California businesses that
follow the law.
(Reporting by Tina Bellon in New York; Editing by David
Gregorio)
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