Ride hailing companies delay California close-down

Uber and Lyft have decided not to close down their operations in their home state of California over a row to do with driver status.

They had threatened to do so if their drivers were ruled to be employees rather than contractors, which would have significantly affected their business model.

CNN reports that a court has given a delaying order which would have forced them to reclassify their drivers, ahead of a planned referendum in November on how employess in the so-called gig economy should be classified.

Making the drivers contractors rather than employees has meant they are not entitled to benefits like minimum wage, overtime pay, workers’ compensation, unemployment insurance and paid sick leave. Similar arguments are taking place in the UK over the status of Uber drivers here.

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