(Reuters) — Uber could be pressured to close down its ride-hailing operations in California if a courtroom ruling that blocks it from classifying its drivers as unbiased contractors goes into impact, the corporate stated in a courtroom submitting.
A California decide on Monday granted the state’s request for a preliminary injunction blocking Uber and rival Lyft from classifying their drivers as unbiased contractors moderately than staff.
Several hundred thousand “gig” staff, together with many at ride-hailing firms and app-based meals supply providers, are affected by the legislation referred to as Assembly Bill 5 (“AB5”), which took impact on Jan. 1.
The shutdown would irreparably hurt Uber and the individuals who depend on its rides operations to generate earnings, the corporate stated in its courtroom submitting on Tuesday.
“If the court doesn’t reconsider, then in California, it’s hard to believe we’ll be able to switch our model to full-time employment quickly,” Chief Executive Officer Dara Khosrowshahi was quoted as saying by CNBC on Wednesday.
(Reporting by Ayanti Bera in Bengaluru; Editing by Maju Samuel)