A court in California has rejected claims from ridehailing companies Uber and Lyft that their drivers are independent contractors, not employees.
CNN reports that the California Appeals Court must reclassify their drivers as employees rather than independent contractors, upholding an earlier court decision.
The state argued that by classifying their drivers as contractors, Uber and Lyft deprived those workers of benefits they are entitled to under a law that took effect at the beginning of the year. It says workers are only independent if they are free from company control and perform work outside the company’s core business.
CNN comments that a reclassification of workers represents a radical shift for the two businesses, which have built up massive fleets of drivers by treating them as independent contractors and not providing them benefits that they would be entitled to as employees, such as minimum wage, overtime, paid sick leave and unemployment insurance.
Similar arguments over the status of Uber drivers and others in similar ridehailing firms are ongoing in the UK.