Editorial: Uber and Lyft should treat drivers as employees
Gig economy companies are under mounting pressure to meet their obligations
August 11, 2020 5:38 pm by The editorial board
California, the spiritual home of the gig economy, has delivered a blow to the business models of platform companies. The state’s supreme court ruled on Monday that Uber and Lyft, two of the largest ride-sharing companies, have to treat their drivers as employees rather than as independent contractors. Although the companies can appeal, if the ruling stands they will now have to pay sick pay, unemployment insurance and holiday pay.
The judgment is the right one: the gig economy has long existed in a legal grey area, allowing businesses to avoid their obligations to workers. The companies argue that the drivers really work for themselves and that businesses operate as an algorithmic matchmaker to find them customers.