A new rule published by the Labor Department on Tuesday that seeks to overhaul certain labor laws could have major consequences for gig companies like Uber and Lyft.
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Companies are required to provide certain benefits and legal protections to employees but not contractors, making employment of those types of workers more expensive. The Labor Department has argued that misclassifying workers as independent contractors denies those individuals protections under federal labor standards, hurts the economy and potentially amounts to wage theft.
"A classification to employees would essentially throw the business model upside down and cause some major structural changes if this holds," Ives wrote in the note.
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