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Uber drivers protest against proposed New Jersey rules

Hundreds of freelance drivers who work Uber gathered in Trenton, New Jersey, on Thursday to protest proposed rules and oversight that they say would put them out of work.

New Jersey lawmakers are considering a bill with provisions including mandated state background checks for drivers, a special seal that says drivers have valid licenses, and state vehicle inspections.

"This bill's aim is to drive us out of the state," Josh Mohrer, Uber's New Jersey general manager, told CNBC. "It's to prevent having to compete. And if it passes, we will have to leave New Jersey."

The protest is part of growing tension nationally and globally surrounding the explosion of transportation start-ups—including Lyft—that are in direct competition with traditional taxi and limousine companies. While Uber and Lyft largely are unregulated, city and state officials are grappling with next steps as more consumers turn to smartphones and mobile apps to hail drivers, often at more affordable prices than traditional options.

In New York City alone, there already are more Uber cars than yellow cabs.

Read MoreThere are now more Uber cars than yellow taxis in NYC

Assemblyman John Wisniewski, who's sponsoring the regulation bill and chairs the New Jersey transportation committee, said a key concern is insurance coverage, NJ.com reported.

"I think it's a difficult issue. We want to allow innovative companies to provide services in New Jersey, but we also have to fulfill our fundamental obligation to ensure that those services are provided safely," Wisniewski told NJ.com.

Late Thursday, the bill narrowly advanced in a legislative committee hearing, and will now advance to a full legislative committee vote.

But start-up drivers say companies like Uber have thrown them a lifeline of freelance work and flexible schedules as they've been shut out of the recent economic recovery.

"I was 57 years old, I had no source of income." -Lou Forino, NJ resident who became an Uber driver

"I was 57 years old, I had no source of income, we were living on my wife's income raising a household with two grandkids in it," Uber driver Lou Forino told CNBC. "Uber came along and in the past year I earned $75,000," he said.

Another protester held a sign that read, "Please don't take away our jobs."

New Jersey drivers for start-up Uber protested against proposed regulations Thursday.
Brad Quick | CNBC
New Jersey drivers for start-up Uber protested against proposed regulations Thursday.

The fight between transport upstarts and officials is only beginning.

Last week, two separate San Francisco judges ruled that juries will decide two landmark cases involving Uber and Lyft. Both companies are facing suits from drivers who want to be classified as employees rather than independent contractors.

The outcome of those lawsuits would only affect California drivers. But the results could set a precedent for labor costs, how workers are classified and the employee benefits they might receive including health care.

Uber and Lyft are part of the larger sharing economy in which independent workers leverage their freelance status. After the Great Recession, more Americans have filled the vacuum of full-time work and benefits with a patchwork of part-time gigs and projects that increasingly are accessed online and through convenient mobile apps.

Cabbie drivers and supporters held their own rally against Uber drivers in New Jersey.
Brad Quick | CNBC
Cabbie drivers and supporters held their own rally against Uber drivers in New Jersey.

Around the globe, there have been cabbie protests against Uber.

In New Jersey on Thursday, state taxi supporters held their own rally down the street.

The president of the Limousine Association of New Jersey Jeff Shanker said he supports the bill because it calls for improved safety measures including driver background checks. "We have some very serious concerns with public safety," Shanker said.

Read MoreWhat the Uber, Lyft lawsuits mean for the US economy