Judge blocks bill banning abrupt driver deactivations

Two powerful rideshare companies scored a win against the Taxi Workers Alliance Tuesday when a federal judge issued a preliminary injunction blocking a City Council bill that prevented apps from deactivating rideshare drivers from their platforms without just cause from taking effect. United States District Court Judge Gregory Woods sided with Uber and Lyft in the ruling, tossing out Local Law 52 first passe that was set to take effect July 28. 

Woods slammed the city in his ruling, arguing that lawmakers failed to calculate the adverse impacts of the law on New Yorkers, that the measure catered to a “narrow” group of drivers and violated the U.S Constitution by interfering with the companies' ability to regulate its individual contracts with drivers. His ruling blocks the measure taking effect pending an ultimate decision in suits brought by Uber and Lyft. 

Bhairavi Desai, president of the New York Taxi Workers Alliance, said in a statement that the ruling is “a punch in the gut to New York City workers and a slap in the face of democracy, endangering the city's ability to enact any workforce-specific regulations.” 

The TWA pushed hard for the deactivation bill, holding repeated protests urging the City Council to pass the legislation last year and, earlier this year, to overturn former Mayor Eric Adams last-minute Dec. 31 veto of the legislation, which the Council did in an overwhelming vote in January. The bill required apps to present drivers with a concrete reason for their deactivation, give workers 14-days' notice of their deactivation and provide workers’ with an appeals process.   

Desai told The Chief last year that deactivations were drivers second most common complaint, behind pay. 

“New York City Uber and Lyft drivers fought for more than three years to end the crisis of unfair firings that left families in poverty and debt, with no incomes overnight and no fair recourse,” Desai said. 
"We won't back down from our fight for justice and for just cause – especially after a court decision so extreme and dangerous to the rights of all workers." 

Companies celebrate

Uber and Lyft celebrated the ruling. 

“We’re pleased the court recognized the importance of preserving our ability to exercise discretion to protect the safety and integrity of our platform,” a spokesperson for Uber said in a statement. “The opinion underscores that driver fairness and rider safety can and must go hand in hand.”  

Uber claimed in court that it deactivates around one percent of drivers per year and that in 2025, more than half of the deactivations in New York City were the result of safety issues including assault and dangerous or intoxicated driving. 92 percent of deactivations, Uber claimed, were either due to safety or fraud issues. 

But a survey of 350 drivers published last year by the city-based Asian American Legal Defense and Education Fund, found that most of the drivers who were deactivated were high-performing, highly rated and had no prior history of issues. A “significant share” of drivers was deactivated before being given the ability to review or rebut allegations and while the vast majority of drivers appealed for their deactivation, more than 90 percent remained permanently locked out, the survey found.

A spokesperson for Lyft said the company was pleased the court “recognized the serious safety concerns,” presented in their challenge. 

"Lyft's ability to protect riders is a top priority,” the spokesperson said. “We now look forward to making our full case." 

The city's Department of Consumer and Worker protection, which supported the bill, said in a statement that it "respectfully disagrees" with the decision and would "continue to review" its options in defending the law.

"Fairness in the workplace starts with guaranteeing stability-not allowing an algorithm to decide whether drivers can earn a living," the statement reads.

The Council has passed similar just cause bills to protect app-based delivery workers from arbitrary deactivations.

Council Member Shekar Krishnan, Local Law 53's original sponsor, pledged to keep fighting to prevent deactivations.  

“We know how important our drivers are to the city, they deserve due process and we will fight every step of the way to preserve their rights,” he said. “No court, no billion-dollar company can take that power away from us.”