Uber and Lyft drivers seeking to form unions hailed a new California law requiring gig economy workers to be classified as employees as a crucial victory. But their plans are in limbo as the companies vow to fight the law.
The drivers are gearing up for a fresh battle with the ride-hailing companies which are seeking to convince California Gov. Gavin Newsom (D) to exempt them from having to comply with Assembly Bill 5.
“We have heard from the industry that they’re not going to follow the law, so we have quite a few fights ahead,” says Nicole Moore, a driver and organizer with Rideshare Drivers United. “We are committed to basic employment rights, a basic wage. We can’t count on anything from [Uber and Lyft.]”
Workers groups argue that while AB5 offers basic protections, collective bargaining is the best way to tackle key issues such as falling wages and a lack of transparency from the company over changes to the app that impact their work.
“The main obstacle is they wouldn’t be able to bargain over pay without a union,” says Alex Rosenblat, a research lead at Data and Society who has spent years studying rideshare drivers.
But Uber and Lyft are insisting workers don’t actually need to be employees to have bargaining rights. They are proposing to Newsom’s office an alternative plan that would include paying drivers a $21 minimum wage for every hour spent driving or picking up a passenger, providing them access to benefits paid for by the company, and the ability to collectively bargain over wages as independent contractors — through a yet-to-be-established state-run board.
“We agree with Gov. Newsom that California still has an opportunity to support the overwhelming majority of rideshare drivers who want a thoughtful solution that balances flexibility with earnings guarantees and protections,” Adrian Durbin, director of communications for Lyft, said in a statement. “We are confident that with his leadership we can reach a historic agreement.”
But the groups reject these ideas, insisting that workers can only have full bargaining rights and protections when they are considered full-time employees.
“They’re just talking about denying driver’s basic driver’s basic rights. They’re touting ‘portable benefits’ when employee status gives workers many of those benefits already,” Moore tells me. “They’re creating a third category of workers who won’t get the basic labor protections of employment.”
The resurgent conflict between the drivers and companies could turn political since gig economy workers have already become a flashpoint in the 2020 elections. Candidates including Sen. Bernie Sanders (I-Vt.) and South Bend, Ind., Mayor Pete Buttigieg have supported the idea of industry-wide bargaining and called for gig economy workers to be considered employees in their presidential platforms.
Drivers’ protests so far have already caught candidates’ attention, and the groundswell of calls for unions could keep the pressure on California politicians to stick to their guns. Rideshare Drivers United, which formed in Los Angeles last year as an independent association of rideshare drivers and now has more than 5,000 memnbers, isn’t alone in seeking to bring drivers together for collective bargaining. The Service Employees International Union, Teamsters, and Amalgamated Transit Union have all been approached by drivers seeking to organize.
“Our main focus is not just to build our numbers, our main focus is to assist these people that have never been in a union…organize them and show them how it is to have a livable wage and benefits,” Art Aguilar, California Conference Board Chair of the Amalgamated Transit Union, tells me.
He dismissed efforts from the companies to undo the law as “fighting the inevitable.” “All they’re doing is delaying them having to pay up for these employees that they need to recognize,” Aguilar says.
Yet Uber and Lyft, alongside delivery startup DoorDash, have vowed to go through with a $90 million dollar campaign for a ballot measure to challenge the law if they can’t stop it from going into effect before Jan. 1. “If necessary we are prepared to take this issue to the voters to preserve the freedom and access drivers and passengers want,” Durbin said.
Some critics of unions for ride-hailing drivers have dismissed the idea that such a dispersed workforce can organize. But Rideshare Drivers United has been able to use social media and its own app to organize drivers who aren’t normally in the same physical space and have no traditional way to meet.
And some Uber drivers have already filed a class-action lawsuit the company for misclassifying them as independent contractors after the law passed and are asking the court to require the company to immediately classify them as employees.
Drivers like Moore say they have a reason to be skeptical that Uber and Lyft’s proposed compromise will actually provide the same protections as employee status.
First, they say there are already big problems with the companies’ alternative proposal for drivers in California. The $21 an hour minimum wage Uber and Lyft offered as a compromise only covers time picking up and driving passengers —which the groups say only represents a fraction of the time spent behind the wheel for drivers.
And the drivers are looking cautiously at what happened when New York City stepped in to regulate the companies’ treatment and pay of gig workers. Since New York City passed a law last year mandating a minimum wage of a little over $17 an hour for rideshare drivers, the companies have limited drivers’ access to the apps during slow periods. The companies argue they did this to comply with the law, but drivers, who protested in New York last week, say it’s a violation of the rules and a way to shift costs to drivers.
There’s also a complex question of how the new California law intersects with the Trump administration’s previous decisions on gig workers. The Trump administration released a memo in May saying that ride-hailing drivers are not employees, and therefore aren’t protected by the National Labor Relations Act, the federal law that allows employees to unionize.
So some labor experts are saying there needs to be even more action than AB5 to make the issue crystal clear: Potentially through a new law explicitly granting the drivers the right to bargain as employees.
“It’s something that the governor might need to address,” says Rosenblat.