Uber and Lyft Are Now Playing Chicken With California Courts

Yet the Uber CEO says this is not “a game of chicken.”

Uber CEO Dara Khosrowshahi speaks in 2019.Mark Lennihan/AP

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On MSNBC today—two days after a California judge ruled that Uber and Lyft must reclassify workers as employees—Uber CEO Dara Khosrowshahi said that if the company doesn’t win on appeal he might shut down the service.

“If the court doesn’t reconsider, then in California, it’s hard to believe we’ll be able to switch our model to full-time employment quickly,” he said. Instead, he suggested the company “will have to shut down until November.”  That’s the month when the Uber backed ballot initiative Prop 22, with $110 million in funding from gig companies, will be voted on. It would provide a carve-out for ride-share companies to continue treating drivers as independent contractors, undoing a long-fought and major win for gig worker activists. Experts say it could create a permanent class of underpaid workers.

Soon after, Lyft President John Zimmer said on an earnings call: “If our efforts here are not successful it would force us to suspend operations in California.”

This is a gambit, even if Khosrowshahi says it’s not “a game of chicken.” Khosrowshahi and Zimmer want the courts to reconsider; they’ll put everyone out of work if that doesn’t happen.

The remarks from Khosrowshahi are particularly ironic given that, just a few days ago, he wrote an impassioned New York Times op-ed admitting that drivers needed to be treated better; he said that “we need new laws” to help do that and suggested creating a benefit fund for healthcare.

Today’s interview makes it clear what he really thinks: We will blow ourselves up to not employ workers.

Uber’s strategy for dominance has long been clear: bend the law, gain market share, use your “essential” nature as leverage to do whatever the hell you want. But that’s also what makes his comment that Uber can’t possibly figure out how to manage under new rules so preposterous. As Gig Workers Rising, a tech labor group, said: “The idea that Uber and Lyft would shut down its app within one of its most lucrative markets is ridiculous, and just another empty threat in their attempt to avoid accountability.”

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And right now, we need to raise about $400,000 from our online readers over the next two months to hit our annual goal and make good on that mission. Read more about the information war we find ourselves in and how people-powered, independent reporting can and must rise to the challenge—and please support our team's truth-telling journalism with a donation if you can right now.

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