California Gov. Gavin Newsom (D)  on Wednesday that will reclassify many gig economy workers from independent contractors to employees, a change that could upend the business models of tech companies like and Lyft.

In a on the bill signing, Newsom called  “landmark legislation for workers and our economy.”

“It will help reduce worker misclassification ― workers being wrongly classified as ‘independent contractors,’ rather than employees, which erodes basic worker protections like the minimum wage,” Newsom wrote, adding that the bill is an “important step” toward fighting against the “hollowing out of our middle class.”

The  which is set to go into effect in January, clarifies the conditions under which a worker should be considered an employee entitled to such benefits

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