There’s been a lot of debate over the topic of what the law considers employees and contractors for businesses. In the rideshare realm, Uber and Lyft have been at the forefront of the debate. Recently, California legislation has changed its laws regarding rideshare drivers and their employment status.
Traditionally, ridesharing accident attorneys Newport Beach classified drivers for companies like Uber and Lyft as contractors. These ‘gig’ jobs are what was at the heart of the business platform for these companies. Now, with changes in the laws getting accepted by the California Public Utilities Commission or CPUC, investors are backing out of stocks held in popular rideshare companies. They believe that more financial responsibility will fall back onto the ridesharing companies which could eat into potential profits.
New Laws Change Employee Status
As any injury attorney Newport Beach will tell you, companies are responsible for paying overtime, workers’ compensation, and healthcare for their employees. Contractors have always been the exemption according to any personal injury attorney Newport Beach. However, new laws in the great state of California are changing this. The CPUC has stated that the state law now sees all drivers for transportation network companies or TNCs for short as employees.
How This Affects Drivers
Uber accident lawyers Newport Beach have reported that many companies considered drivers as independent contractors. This allowed the business to not pay for things like worker’s compensation. However, all TNC drivers are now classified as employees. This has affected many drivers who don’t want to be considered full-time employees. Rather, they enjoy the flexibility of working on-demand.
Lyft accident lawyers Newport Beach are stating that continuing to classify rideshare companies as TNCs will highly affect their ability to keep costs low for patrons. With the added financial responsibility of treating drivers as company employees, many rideshare companies may need to downsize their employee base. This can lead to an immense decrease in work for California residents.
Rideshare Companies Are Trying To Stop Legislation
Uber and Lyft accident lawyers Newport Beach have been fighting to keep this new law from being enacted. Uber was arguing that this legislation was unlawful in its effect on app-based companies. Lyft accident lawyers Newport Beach have stated that these laws were flawed and would result in a major economic upheaval in the midst of the COVID pandemic.
Both companies have been pushing a ballot since November to exempt their rideshare companies as well as food delivery companies from this law. With over 90 million earned, these companies have their own proposals of what seems fair. They would allow drivers to receive mileage-based compensation. They would provide them with healthcare stipends and accident insurance. These contractors would be viewed as independent contractors by ridesharing accident attorneys Newport Beach instead of employees.
Uber and Lyft accident lawyers Newport Beach are continuing to fight the new California legislation and are pushing to have their ballot enacted. Some independent workers are criticizing the ballot stating that this type of program would lack protections like unemployment insurance and sick pay. Uber accident lawyers Newport Beach are still dealing with legal suits from the state of California stating that Uber and Lyft have been misclassifying their employees since the new law came out.