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The ruling mostly upholds a voter-approved law that said drivers for ride-share companies are independent contractors and are not entitled to benefits like paid sick leave and unemployment insurance.
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Texas's restrictive new abortion law has raised concerns that people who drive for the ride-hailing companies could face lawsuits for transporting passengers to clinics.
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Lyft and Uber fares are estimated to be nearly 80% higher than pre-pandemic prices in some cities. The companies say a driver shortage is pushing up prices.
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Uber and Lyft are cheering the passage of Prop 22, which says they don't have to treat their drivers as employees and provide benefits such as paid sick leave. Critics say they'll keep fighting.
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Uber and Lyft have been fighting California over whether drivers are employees, entitled to benefits, or independent contractors. A state judge orders them to consider all those drivers employees.
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The state accuses the ride-hailing apps of flouting a labor law by classifying drivers as independent contractors instead of employees.
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The ride-hailing company is also furloughing hundreds of workers and cutting pay as it tries to reduce costs during the coronavirus pandemic.
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Gig companies like Instacart and Uber promise financial assistance to workers affected by the coronavirus. But some workers are finding it hard to get that aid.
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The San Francisco-based transportation firms say they are acting in line with public health efforts to slow the spread of the coronavirus. Both are still operating their regular ride-hailing services.
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The outbreak is creating uncertainty for Uber drivers and other gig workers, who face difficult choices about whether to work or stay home and lose their livelihoods.