SAN DIEGO COUNTY, Calif. — Ride-hailing companies Uber and Lyft got a last-minute reprieve from a court order Thursday which they said would have put them out of business in California. While the news cause for celebration to some, it comes as a blow to luxury car service companies.
Lyft and Uber had both said they would be forced to suspend their operations in California if a court didn't intervene.
"Our future is uncertain, my friend, at this point,” said Uber and Lyft driver Chris Rios.
He was getting nervous and wasn't sure what would happen if the ride-hailing companies he works for full time would've left California.
But a California court stepped in and extended the length of time the companies have until they need to comply with AB5. It’s the state law that went into effect in January requiring ride-booking services to re-classify drivers from independent contractors to employees entitled to benefits.
The law is one that competitors fought hard to pass.
"Look, AB5 is there to stand up for workers’ rights,” said Charles Geng who owns a luxury car service in San Diego.
He said the legal battle was his key to a "level playing field," providing an environment for fair competition between drivers of luxury cars and Uber Black.
"The reason why that they are able to offer such artificially grossly underrated rates is because they are not following the labor laws,” Geng said.
Some drivers emphasize they want the flexibility of picking their own schedule.
Either way, voters will have their say in the matter soon. Uber, Lyft and other similar app-based services are backing Proposition 22 on the November ballot. It would exempt their workers from AB5 altogether.
"What they're saying is, ‘please allow us to continue to exploit drivers,’” Geng said.
Oral arguments in the case are set to play out in October.
AB5 author Lorena Gonzalez issued a statement Thursday saying in part:
“The ruling gives them another month to come up with a plan to get in compliance with the law without hurting their workers."