Uber CEO Dara Khosrowshahi has threatened to temporarily shut down riding service in California if it loses a long-drawn legal battle over a state's labour law seeking to reclassify contractors as employees.
In an interview given to MSNBC, Khosrowshahi said that Uber would likely shut down temporarily for several months in California if a court does not overturn a recent ruling requiring the firm to classify its drivers as full-time employees.
He also said that the Uber will continue a lengthy political and legal battle it has been waging since before the law was enacted.
In December 2019, Ride-hailing giant Uber and delivery company Postmates had filed a lawsuit against the state of California, claiming a new law that would treat gig-economy freelancers as employees is unconstitutional.
The gig economy has given drivers "opportunities to earn money when and where they want, with unprecedented independence and flexibility," the lawsuit said.
The legislation, known as Assembly Bill 5, says that -- under certain conditions -- independent contractors are classified as employees and granted the minimum salary and health insurance benefits that entail.
Drivers are divided between those who want the same security as employees and those who want the flexibility of being able to choose the hours they work.
The ride-hailing giant also said that it will appeal a court ruling on August 16. Uber is also planning to ask voters in November to overturn the law.
Uber and its American rival Lyft have each put aside 30 million dollars to organise a referendum, allowed under Californian law, to replace the legislation with a compromise on social rights that have been put before the state Governor.
(With inputs from PTI)