Uber Technologies Inc.’s ride may stop in California next week, but Uber Eats – and many drivers who have switched to service for shelter-in-place orders – will leave.
If it applies the injunction granted by a San Francisco Superior Court judge on Monday, the ride-hailing will be discontinued on August 21. Thursday, Uber and Lyft Inc. LYFT lost its appeal to extend the 10-day stay on the injunction and said they would appeal to the High Court.
Uber’s Eats business has seen an increase in demand during the coronovirus epidemic, while demand for rides has been tucked in as well as travel and personal conferences and business meetings. For the first time, Eats brought in more revenue ($ 1.21 billion) from rideshare ($ 790 million) in the second quarter.
See: Uber’s delivery business tops core core ride-healing as epidemic rocks earnings
As California remains under a statewide asylum-location order, a rebound in ride demand that Uber and Lyft are seeing in other states is slow to come to the state, the companies said during their recent earnings call . As a result, many drivers have switched to deliveries at a time when some people cannot or do not carry their own food or groceries.
“The ride has dried up and the food is safer for the passengers than the passengers,” said Nicolas Moore, a Los Angeles-based driver organizer at Rideshare Drivers United.
Mustafa Makkar, who has been driving for Uber in San Francisco for nearly six years and is an organizer with Gig Workers Rising, recently went for delivery. He is distributing for Uber Eats anyway, while the company is fighting a law to secure the rights and benefits of drivers like him.
“Like any employer when they see workers mobilizing for their rights and deserve them, (Uber) threatens to fire everybody,” Makkad said. “They have always said that they care about their drivers and workers but have proved contrary to their policies and practices, and we can clearly see this in the ballot initiative.”
Uber, Lyft, DoorDash, Instacart and Postmates put in a million-dollar Proposition 22, which California residents will vote on in November. The initiative seeks to exempt gig companies – whose businesses depend on workers they want to classify as employees – from Legislative Bill 5, which became law in California this year, starting in 2018. Following the fierce battle, when the California Supreme Court decided when a worker could be considered an independent contractor, the Dynamex case adopted a common standard.
Proposal. 22 provides concessions equal to the minimum wage to drivers without giving full employee protection. And this week Uber renewed its call for a portable benefits plan that all gig companies should pay to help workers with health insurance or periodic costs.
“I don’t think it’s right to be an independent contractor,” said Uber CEO Dara Khosroshahi Tweeted Friday. “The status quo is not working. We have therefore put forward a detailed proposal to give drivers more leverage to maintain the independent model.
While it appears that Uber Eats will remain unaffected for now as California has won a round in the ride-hailing classification battle, the employment status of distribution workers is taking the form of the next big fumble.
San Francisco District Attorney Chesa Boudin sued Dordash in June over the classification of its delivery staff, and this week he asked the company to immediately pass an injunction to comply with AB5, pending an October trial. San Diego won a case against Instacart earlier this year, but the company is appealing.
For the fact that the prohibition in the California case against Uber and Lyft only applies to ride-healing drivers, Veena Double, a UC Hastings law professor who studies the effects of technology on workers and organizing among gig workers She says that although she believes delivery is also being aborted by laborers, “the facts of abortion are different.”
“Doubleday said,” It would be difficult to organize both sets of facts at the same time. “I suspect, however, that the California Attorney General will work to enforce the law against the food delivery business model in the coming months.”
A spokesman for the state AG’s office for comment on Thursday said, “We are pleased with the court’s decision, confirming Monday’s order and we will continue to do our work to protect workers’ rights in California.”