Uber, Lyft, Postmates and DoorDash get dashed, as the state Senate approved the gig-worker employee rights bill Tuesday afternoon, and the Assembly just passed it this morning.
We are currently in the longest economic expansion in U.S. history. But this stock-market and economic resilience and nonstop parade of venture capital zillions are partly powered by the fact that many companies are hiring more contractors than employees, pulling a complete end-run on established workplace protections like regular pay, health insurance, paid time off, and unemployment protection. Noting that this practice has wildly exacerbated income inequality, a piece of California legislation came together this year aimed at granting many gig workers better wages and benefits. Uber and Lyft, of course, opposed the maneuver vociferously, prompting a driver caravan protest in favor of the bill that attracted ‘Mayor Pete’ Buttegeig himself to raise hell outside Uber headquarters.
That bill is now poised to become law. KPIX reports that the employees and independent contractors bill AB5 was passed in the state Senate Tuesday, and the Los Angeles Times just reported that the state Assembly approved it shortly before noon Wednesday. Gov. Newsom has said he will sign the bill into law.
Breaking: California lawmakers passed a sweeping bill, known as AB5, that rewrites the rules of employment across industries as varied as ride-hailing, construction, healthcare and nail salons. https://t.co/mLybWYahEf— Los Angeles Times (@latimes) September 11, 2019
For their part, very-much-affected companies Uber and Lyft have immediately responded by slinging a combination of compromise offers and utter falsehoods. Lyft has reportedly sent drivers an alert claiming that “you may soon be required to drive specific shifts, stick to specific areas, and drive for only a single platform (such as Lyft, Uber, DoorDash, or others),” which AB5 does not require. Lyft is also now claiming they’d be willing to give drivers paid sick leave and benefits, an offer they were not making prior to the bill’s passage.
Today, @lyft sent this to drivers.— Cyrus Farivar (@cfarivar) September 11, 2019
It states that drivers “may soon be required to drive specific shifts, stick to specific areas, and drive for only a single platform (such as Lyft, Uber, Doordash, or others).”
FYI: #AB5 does not have any such language. (h/t @ChristianJPerea) pic.twitter.com/dOWd9FqljN
For their part, Uber just wrapped up a conference call where chief legal officer Tony West (who, yes, is Kamala Harris’ brother-in-law) reportedly said that he feels Uber would pass the legal “test” to continue classifying drivers as contractors. But he also said the company would continue spending tens of millions on a 2020 ballot measure to shoot the law down, which common sense would indicate that Uber does not think they will pass said test.
.@Uber chief legal officer @tonywest (Kamala Harris' bro-in-law & former frequent KCBS legal analyst) says company is "disappointed that we were not able to reach a compromise" on #AB5 & "California is missing a real opportunity to lead the nation" by rejecting Uber's framework.— Doug Sovern (@SovernNation) September 11, 2019
Gavin Newsom has already said he’ll sign the bill, writing in a Sacramento Bee op-ed that “Employers shirk responsibility to safety net programs like workers’ compensation and unemployment insurance. Taxpayers are left to foot the bill.”
This fight will surely continue into the 2020 election (already a rather charged affair) with a big-tech sponsored ballot measure to remove these new employee benefits and protections. Expect investors and founders to harass their subordinates with emails promoting the ghoulish canard that people prefer to not be paid regularly, have health care, or receive any employment benefits. They’ll say that actually hiring employees would “stifle innovation,” “limit consumer choice,” or whatever various market-based cowpie catchphrases they settle upon. But until then, your DoorDash delivery person might get employee status, so they might steal less of your food.
Image: freeimage4life via Flickr