Judge rejects Uber, Lyft bids to delay California driver injunction

FILE PHOTO: A sign marks a rendezvous location for Lyft and Uber users at San Diego State University in San Diego, California, U.S., May 13, 2020. REUTERS/Mike Blake

(Reuters) – A California judge on Thursday refused to give Uber Technologies Inc (UBER.N) and Lyft Inc (LYFT.O) more time to appeal his decision forcing them to classify drivers in that state as employees, which they have said would necessitate restructuring their businesses.

At a hearing in San Francisco Superior Court, Judge Ethan Schulman said he found no reason to extend his Aug. 20 deadline for the ride-hailing companies to appeal the preliminary injunction he issued on Monday before it could take effect.

“I am unconvinced that any extension of the 10-day stay is required,” Schulman said. “Both applications are denied.”

Uber and Lyft have said they will appeal.

In late afternoon trading, Uber shares were down 0.8% while Lyft fell 4.9%. Lyft had reported quarterly results after U.S. markets closed on Wednesday.

The injunction came in a lawsuit where California and the cities of Los Angeles, San Diego and San Francisco accused Uber and Lyft of violating Assembly Bill 5, a new state law making it harder to treat “gig” workers as independent contractors.

Uber and Lyft prefer using that classification for drivers, because treating them as employees would require benefits such as minimum wage, paid sick and family leave, unemployment insurance and workers’ compensation insurance.

The hearing came one day after the companies threatened to temporarily stop serving California, arguing that treating drivers as employees would undermine their business models.

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