California court ruling paves way to stave off Uber, Lyft shutdown

(Reuters) — A California appeals court on Thursday halted a lower court order that would have forced Uber Technologies Inc. and Lyft Inc. to treat their drivers as employees, paving the way for the companies to avoid a shutdown of ride services in the state.

The companies had said they would be unable to comply with a new law that would consider their drivers employees entitled to benefits such as minimum wage, overtime and sick pay, and unemployment insurance.

Lyft shares were up almost 9% after the last-minute ruling, and Uber shares were up 6.4%.

The companies had sought the intervention of the California First District Court of Appeal in San Francisco to block an injunction order issued by a judge last week. That ruling forced the companies to treat their drivers as employees starting Thursday after midnight.