Uber Has Bigger Problems to Worry About Than the Shutdown

For companies like Uber and Lyft, the biggest 2019 headlines will come when they go public, as long as the federal shutdown ends and the U.S. Securities and Exchange Commission gets back to work. But the more important news may be 3,000 miles away in Sacramento, where lawmakers will have to deal with the fallout from a sweeping 2018 state Supreme Court verdict. The decision made it much tougher for companies to label workers independent contractors rather than employees—a direct threat to the business model of ride-hailing companies, among others.

“We cannot just put our heads in the sand with respect to the future of work,” says Evan Low, a member of the California Assembly who co-chairs the legislature’s tech caucus. “Status quo is unacceptable, and you will start to lose money.”