Both Uber and Lyft are anxious about a bill that could potentially make California the first state where rideshare drivers — and all delivery-app drivers — can't be classified as contractors.

Assembly Bill 5 follows on a recent state Supreme Court decision, known as the Dynamex decision, that has strengthened state law around independent contractors. Two tests that came out of the decision threaten to upend Uber and Lyft's business model, and after penning an op-ed in the Chronicle (co-signed by Uber CEO Dara Khosrowshahi and Lyft co-founders Logan Green and John Zimmer), the two companies called on their California drivers in recent weeks to email state legislators to oppose AB 5, saying they want to remain independent.

In order to qualify as independent contractors, the workers must be doing "work that is outside the usual course of the hiring entity's business," they must be free from control by the hiring entity in the performance of said work, and they must be "customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed." Uber and Lyft have an obvious problem here: drivers are the core of their business and their biggest revenue source, and they've spent the last five or so years of their existence arguing that they are software companies, even though they don't sell software — they sell rides. And in order to qualify for the latter test, the drivers would need to have already been in the taxi trade, technically.

As Business Insider explains, this leaves the companies in a fight for their very existence, especially anticipating the possibility that the Dynamex decision will be replicated in other states. Uber and Lyft have scared drivers into believing they won't have as much freedom or flexibility if they lose their contractor status — which isn't true, since the companies could mandate that flexibility — but in reality, such a law in California would mean that the companies would be on the hook for providing insurance to drivers, and paying half their Social Security (6.2% of wages) and Medicare (1.45%).

Short of raising prices for rides across the board, the change would likely bankrupt both companies in a hurry. But many labor advocates see such moves as necessary.

Ominously, in their op-ed, the company heads write, "What’s more, our economy is changing. Automation, artificial intelligence and other emerging trends mean we can’t know exactly what the future of work will look like. What we do know is that more people are choosing to work independently." In other words, take this gig while you can! The robots are coming!

Wall Street analysts have warned that this ruling could spell trouble for Uber and Lyft, and we won't know the extent until the CA legislature decides what to do.

For their part, Khosrowshahi, Green, and Zimmer suggest that they want to "update century-old employment laws," create "a system of worker-determined benefits," and launch "a new driver association" that would advocate for drivers at the state and local levels.

Lyft reportedly got 30,000 of its drivers to write in to legislators to oppose AB 5. Will lawmakers listen?