The Future of the Gig Economy May Be in Question

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The California appeals court is finally hearing some of the arguments from gig workers in their lawsuit. The Tuesday appearance allowed them to hear arguments from lawyers for Uber Technologies as well as Lyft Inc. and the state of California itself.

The argument is whether or not the state is able to recognize the drivers for Uber and Lyft as employees or whether they are still considered part of the gig economy. If these individuals are considered employees they would have the right to minimum wage, health insurance, unemployment insurance and overtime pay.

With this court battle there is a huge consideration from the companies as well as their workers because California is starting to push legislation that would make these gig workers or independent contractors actual employees.

The latest law passed means that it’s a whole lot harder for the companies that hire these independent contractors to consider them as independent contractors. This includes not just the ride-hail community but also the food delivery business and app-based companies as well.

Currently the state law allows thee appeals court to issue a ruling in only 90 days. It is likely that the entire future of gig workers in the state will be decided by a decision on November 3rd. But there’s a great deal to it that needs to be considered.

At this point companies like Uber, Lyft, Door Dash, Instacart, and Postmates are writing a huge ballot measure and a statement that would counter the current law and it cost the companies over $184 million to get it put together.

Many counties in California are looking at whether these companies need to be responsible for their workers in entirely different ways and whether they should be actually considering those workers as employees with the rights that they would have therefore. While the appeals court is considering this issue it has currently been put on hold.

There was an almost two hour hearing on Tuesday and lawyers for Lyft and Uber presented information to the judges panel that the court had ignored the evidence that was present. Their attorneys claim that irreparable harm would be caused to all of the residents of the state if this ruling were upheld.

There’s no telling what could happen if the ruling stays but lawyers for these companies say that companies would have to change their business model and would then be forced to let go of thousands of workers.


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