Shares of Uber Technologies, Inc. ( UBER ) and Lyft, Inc. ( LYFT ) are volatile Thursday following a court ruling allowing the ride-share companies to treat drivers as contractors.

What Happened: The California Supreme Court ruled that Proposition 22, a 2020 ballot measure, is constitutional. This measure allows ride-hailing companies like Uber ( UBER ) and Lyft ( LYFT ) to classify their drivers as independent contractors rather than employees.

This decision is a crucial win for gig-economy companies, preserving their business model and avoiding the additional costs associated with classifying drivers as employees.

UBER ( UBER ), LYFT Price Action: Uber ( UBER ) shares were up by 1.62% at $67.21 and LYFT ( LYFT ) shares were down by 1.86% at $12.15 at the time of writing, according to Benzinga Pro.

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