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Uber and Lyft Stock Surges After California Proposition 22 Vote Lifts Gig Companies

Uber
Sam Boughedda

Shares of both Uber (NYSE: UBER) and Lyft (NASDAQ: LYFT) have rallied premarket on Wednesday after a vote in California decided that gig workers will not chrome employees.

Voters in California approved Proposition 22, a ruling that allows gig companies such as Uber Lyft, and DoorDash to continue hiring gig workers as independent contractors. 

If the measure had not been approved, it would have meant these companies would be forced to employ the drivers, and provide other benefits such as healthcare. 

According to a report by The Verge, Proposition 22 was the most expensive ballot in California history, costing $200 million.

Divers for gig companies will be afforded benefits such as a minimum hourly wage, but they won’t get full benefits that regular employees are given.

Uber shares have risen over 10% premarket to $39.52, after closing Tuesday at $35.77, while Lyft shares are currently up12.89% at $29.61 after a close at $26.23 during the previous session. 

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Sam Boughedda
Sam Boughedda
Team Member

Sam is a trader and lead stock market writer at AskTraders. After starting his career in the forex market, Sam now focuses on stocks, specifically consumer staples.