By Christiana Sciaudone
Investing.com -- Uber (NYSE:UBER) and Lyft (NASDAQ:LYFT) fell after Massachusetts said it would sue them for misclassifying drivers. Uber was down 1.9% and Lyft 2.3%.
Attorney General Maura Healey said on Twitter that the companies built businesses on a model that “misclassifies drivers as independent contractors instead of employees. Drivers aren't guaranteed the minimum wage & don't get paid overtime or paid leave when they're sick. But Massachusetts law is clear—drivers are employees."
Uber is down 14% since the start of 2020, with 27 buy ratings, three holds and no sells, according to data compiled by Investing.com.
Lyft has dropped 35% since the start of the year, and has 17 buy ratings, six holds and no sells, according to data compiled by Investing.com.
The suit comes on the heels of California making the same move, saying Uber and Lyft are in violation of California law AB 5. The state attorney general was joined by the city attorneys of San Francisco, Los Angeles, and San Diego in the action.
The outcome of these lawsuits could take years to come to fruition, according to JD (NASDAQ:JD) Supra legal news and opinion website.