Lyft will suspend service in California at the end of the day

Shawn Knight

Posts: 13,518   +132
Staff member
In brief: Lyft on Thursday confirmed that at the end of today – at 11:59 p.m. Pacific, to be exact – the company will suspend all rideshare operations in the state of California. The move comes after months of uncertainty for freelancers in the Golden State.

Back in January, lawmakers in California enacted Assembly Bill 5 (AB5) which impacts how businesses in the state can classify independent contractors and freelancers. California Attorney General Xavier Becerra in May sued ridesharing providers Uber and Lyft over the matter and earlier this month, a judge sided with the state, putting the companies on the clock to make a change.

Lyft in announcing its decision said they have been advocating for a way to offer benefits to drivers while maintaining the independence that contractors enjoy. “Instead, what Sacramento politicians are pushing is an employment model that 4 out of 5 drivers don’t support,” the company added.

According to Lyft, under the proposed changes, 80 percent of drivers would lose work and others would see capped hourly earnings and scheduled shifts.

Simply put, Lyft said it’s the sort of change that can’t simply happen overnight, so they are having to suspend operations in California for now.

Uber is expected to make a similar announcement sometime today although as of this writing, nothing has been made official.

Image credit: Allmy, Jonathan Weiss

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moobg

Posts: 43   +45
Another slow clap for the People’s Republic of California.
Congrats commiefornia you didn't listen to the drivers or the people, now you get to pay taxi prices
Do people even pretend to do any research anymore? The drivers are the ones who have been complaining about not receiving minimum wage/a livable wage, lack of insurance, no overtime, no compensation for expenses and so on. They even went on strike over it. This is California trying to protect its citizens.

In any case, the story needs to be updated since a judge granted Uber/Lyft a reprieve as litigation continues.
 

candle_86

Posts: 729   +730
Do people even pretend to do any research anymore? The drivers are the ones who have been complaining about not receiving minimum wage/a livable wage, lack of insurance, no overtime, no compensation for expenses and so on. They even went on strike over it. This is California trying to protect its citizens.

In any case, the story needs to be updated since a judge granted Uber/Lyft a reprieve as litigation continues.

A few vocal drivers complained, go visit rededit or talk to drivers waiting in a lot, they are not in support, the majority don't.

80% are going to be unable to work under California's new requirement, drivers will no longer have the freedom to say no to a sketchy person or neighborhood, they can't pick when to eat, or if they want to work a half day. It's not a win for the drivers. I drove Uber after work the last 2 years around the holidays for a little extra money, that option will be gone now for drivers. The state is literally wiping out people's ability to work, there is no other way to spin this.
 

Hexic

Posts: 1,053   +1,562
TechSpot Elite
Do people even pretend to do any research anymore? The drivers are the ones who have been complaining about not receiving minimum wage/a livable wage, lack of insurance, no overtime, no compensation for expenses and so on. They even went on strike over it. This is California trying to protect its citizens.

In any case, the story needs to be updated since a judge granted Uber/Lyft a reprieve as litigation continues.

The business model was supplementary income, not a dependency; hence the entire reason they were “contractors”.

Every job (particularly contract gigs) that doesn’t pay all of one individual‘s bills doesn’t have to mandatorily, nor is it entitled to. Another separation from the reality of the free market concept.
 

candle_86

Posts: 729   +730
The business model was supplementary income, not a dependency; hence the entire reason they were “contractors”.

Every job (particularly contract gigs) that doesn’t pay all of one individual‘s bills doesn’t have to mandatorily, nor is it entitled to. Another separation from the reality of the free market concept.

the other thing to consider is contracts don't cover your expenses unless its part of that contract. Every driver who is smart tracks their milage, and fuel costs, and uses that at tax time. I know a few full time drivers, they made 45-60k last year but taxable income after deductions was below 10k aka the threshold to even file, and none of them are struggling to pay bills or rent.

The IRS deduction is $.50 /mi which is a better figure than fuel costs unless your driving an SUV then you deduct fuel costs instead.
 

Uncle Al

Posts: 8,249   +7,023
When I was a hack back in the derby city, if you hustled you could make more than part time money, in fact you could make a pretty decent living. Sounds like a lot these drivers just want to be paid no matter if they work or not. That's' not the way the business works and they know this going into it. It's kind of like the lawn care business ... if you work hard you make good money; if your lazy and want to charge the little old lady $100 to speed mow her yard you're not going to have much work and NO referral's .....
 

moobg

Posts: 43   +45
A few vocal drivers complained, go visit rededit or talk to drivers waiting in a lot, they are not in support, the majority don't.
The business model was supplementary income, not a dependency; hence the entire reason they were “contractors”.

Every job (particularly contract gigs) that doesn’t pay all of one individual‘s bills doesn’t have to mandatorily, nor is it entitled to. Another separation from the reality of the free market concept.
The idea that Uber/Lyft are a source of supplementary income isn't true for many people, and it's especially not true in LA. I've spoken with a number of drivers over the years (Pre-COVID-19 of course) in and around LA County/OC who drove full-time and they definitely wanted to be treated as employees as they'd then incur less risk. But this is all anecdotal.

It's also been shown time and time and time again that you can't really trust what Uber/Lyft say when it comes to wage/expense data.

We've also seen that, in an Uber/Lyft vacuum, there are definitely companies who'd be willing to play ball and abide by the rules.

As for the majority of Uber/Lyft drivers wanting to remain IC, that's true, though that number is shrinking, and even though the number of drivers who want to be classified as employees is under 20%, they account for about 50% of total rides. As an aside, you'll find quite a few comments from drivers there as well who are both for and against AB5.

CA is the 5th largest economy on the planet, so obviously rules laid out here won't be applicable to everyone, but we're a massive state with 40 million people, so, yeah, we're going to do things differently than other states from time to time.
 

Endymio

Posts: 1,334   +1,219
This is California trying to protect its citizens.
Trying, but failing miserably. As Milton Friedman said, minimum wage/worker protection laws are as clear example as possible of a law which has the exact opposite effect of what is intended.

Article quote: "80 percent of drivers would lose work and others would see capped hourly earnings and scheduled shifts."
 

Endymio

Posts: 1,334   +1,219
It's not predatory, when I signed up to drive I was fully aware of the agreement and what I'd be paid.
And you chose to sign up and drive for them because that was a better option for you than any of the other work alternatives.

Yet here comes the nanny state to tell you they understand your wants and needs better than you do. So you -- if you work in California at least -- are soon going to be unemployed and dependent on that state handout.
 

candle_86

Posts: 729   +730
And you chose to sign up and drive for them because that was a better option for you than any of the other work alternatives.

Yet here comes the nanny state to tell you they understand your wants and needs better than you do. So you -- if you work in California at least -- are soon going to be unemployed and dependent on that state handout.

Yep I started driving because I got laid off and unemployment wasn't enough, I was making 600/WK on unemployment but was making 250-300 a day driving Uber on good days, my average week 950-1100.

Now someone explain to me why this is a bad thing, even after gas and car cleaning supplies I still came out ontop, so someone going to college can do quite well, the alternative is a part time job where you might make 300-400 at 15hr depending on hours.
 
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Impudicus

Posts: 243   +236
I wonder what impact this will have on drunk driving deaths. I feel like uber and lyft have made a positive change by reducing the number or drunk drives by being so easy to use. Never looked at the numbers though, it's just an assumption based on observation.
 

Hexic

Posts: 1,053   +1,562
TechSpot Elite
It's not predatory, when I signed up to drive I was fully aware of the agreement and what I'd be paid.

This ^

If you don’t understand the risks of ride sharing, then you shouldn’t sign up for it. It’s not the state’s job to provide a safety net every time you make a poor choice.

I don’t go to Vegas expecting to hit it big either.
 

Ben1978

Posts: 128   +91
Do people even pretend to do any research anymore? The drivers are the ones who have been complaining about not receiving minimum wage/a livable wage, lack of insurance, no overtime, no compensation for expenses and so on. They even went on strike over it. This is California trying to protect its citizens.

In any case, the story needs to be updated since a judge granted Uber/Lyft a reprieve as litigation continues.
I really like the comments section on this site compared to other gaming sites I read because there aren't too many overtly woke people here. On the other hand there are a lot of traditional right wingers. Can't win em all!

Tbh the left wing media that I largely read has been telling me that Uber etc are shirking their responsibility to their employees by considering all of them contractors even if many use it as their primary source of income. There's a lot of people here saying that's not true, including Uber drivers, but I'd really need to see an academic paper or authoritative report to know where the truth lies, as much of the average person's knowledge on this comes from a biased perspective, biased news or is anecdotal.
 
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Endymio

Posts: 1,334   +1,219
the left wing media that I largely read has been telling me that Uber etc are shirking their responsibility to their employees by considering all of them contractors even if many use it as their primary source of income.
That is not, and has never been the primary legal test for contractor status. Nearly all contractors in any field of endeavor consider it their primary source of income. The IRS uses a 20-part test, which (prior to California's wading in) Uber and Lyft easily passed.

There's a lot of people here saying that's not true, including Uber drivers
I don't know the relevant percentages of drivers in favor or against, but I do know 97,000 of them banded together to oppose the California law, with support for Prop 22, which would exempt them from being considered employees. Interestingly enough, many community organizations, such as several branches of the California NAACP, also believe these drivers should remain contractors, and also support Prop 22.