Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
“An appeals court has allowed ride-hailing giants Uber and Lyft to continue treating their drivers as independent contractors in California… The stay pauses a lower-court ruling that was scheduled to take effect at midnight on Friday and would have forced Uber and Lyft to treat all their drivers as employees.” AP News
In May, California sued Uber and Lyft, “alleging they misclassified their drivers as independent contractors under the state’s new labor law… The labor law, known as AB5 and considered the nation’s strictest test, took effect Jan. 1 and makes it harder for companies to classify workers as independent contractors instead of employees who are entitled to minimum wage and benefits such as workers compensation.” AP News
In November, Californians will vote in a referendum on Proposition 22, which if passed would “define app-based transportation (rideshare) and delivery drivers as independent contractors and adopt labor and wage policies specific to app-based drivers and companies.” Ballotpedia
Here’s an op-ed by Uber’s CEO Dara Khosrowshahi calling for a new legal framework for gig workers. New York Times
The right argues that Uber should not be required to treat its drivers as employees.
“AB5 was a bad idea when it passed last year. It’s an even worse one in our current economic climate… Many gig workers, like freelance journalists, prefer flexibility and vigorously opposed AB5. Some people do gig work to supplement income from other jobs and to ensure against lost income. Turning contractors into employees makes them more expensive to the employers who hire them, which means fewer jobs…
“Gig work keeps people active in the labor market, even when the economy is in a deep recession. Doing some work, even part-time, helps people avoid falling into the long-term unemployment trap. Just staying in the habit of going somewhere and earning income is valuable. It provides structure and boosts morale… while turning drivers or freelance journalists into employees may sound helpful, what it really means is that only a fraction of gig workers will receive these benefits. The rest will be let go.”
Allison Schrager, City Journal
“Gig work allows people to work around scheduling issues and adapt on the fly. Parents who need to support children through distance learning but still earn a living have better opportunities in some instances to do that by maintaining control of their work schedule rather than adapt to the necessities of a payroll-style work environment… Let people choose gig work, or choose more traditional employment instead. Right now, California’s law allows workers only to choose no income at all, an all-but-predictable outcome of the perverse incentives created by AB-5.”
Ed Morrissey, Hot Air
“Trying to turn these people into full-time workers, as the state of California plans to mandate and as some Democrats in Congress have proposed doing everywhere, would destroy much of what makes these types of jobs useful to consumers and workers alike. And yet, we still need to make this environment friendlier and easier to navigate for gig seekers, whether they side-hustle for a day or a year…
“Underlying structures that protect our workers, including benefits systems, job-related insurance, and anti-harassment laws, must be altered to embrace the independently employed. Like it or not, we shouldn’t continue building an economy reliant on the presumption that everyone is a full-time employee with the traditional accompanying pay, benefits, and limited flexibility.”
Eli Lehrer, Washington Examiner
“As a heavy user of Uber before the pandemic arrived, I made it a habit of asking every driver what they think of AB5. The response has been unanimous and emphatic: every single driver hates it with the intensity of a 1,000 white hot suns… the drivers love the flexibility of setting their own hours, as few or as many as they like. Some people like to drive Uber to make extra money on the weekend… A few make it their primary source of income, but often in concentrated ways, i.e., by driving long days for a week in San Francisco or LA and then returning home to the central valley and taking the next week off…
“Like any kind of work or any employer, Uber drivers I’ve spoken with have their specific complaints about the company, but are generally satisfied and dismayed that it can be taken away from them. AB5 was passed at the behest of incumbent taxicab companies who dislike competition, and by labor unions who hate the idea of independent labor. Republicans ought to be able to capitalize on the simple message that commercial transactions between consenting adults ought to be legalized.”
Steven Hayward, Power Line Blog
“This is as much of a political fight as it is an economic one. Lawmakers such as California governor Gavin Newsom are fighting for their allies in organized labor. They can’t simply back down at this point and let Uber and Lyft off the hook without looking like, well, they are backing down. Nor can Uber and Lyft back down and accept drivers as full employees if their claim is that contracting is central to their business model. Certainly, the companies can’t make the change without radically restructuring how they do their business… So, who calls whose bluff first?”
Sean Higgins, National Review
The left argues that Uber should be required to treat its drivers as employees.
The left argues that Uber should be required to treat its drivers as employees.
“Despite the sympathetic posturing of Khosrowshahi, Uber's business model is still premised on underpaying its drivers. When they're classed as independent contractors, drivers have few of the protections of an employee: no minimum wage, no benefits and few avenues to challenge their employer if they feel they're wrongfully terminated or mistreated…
“Under Prop 22, drivers would be paid 120 percent of the local minimum wage, but only for ‘engaged time’ — that means the time between when they accept a ride and complete it. Since as much as 37 percent of drivers' time is spent waiting, the National Employment Law Project found this would actually be a further pay cut for many drivers.”
Paris Marx, NBC News Think
“New York City published a report called ‘Empty Seats, Full Streets,’ which showed that a third of drivers have empty cars as they circle, looking for a passenger and burning up hydrocarbons. Too many drivers meant not only more traffic and emissions, but not enough work for all of the drivers. Many do not even make minimum wage after driving expenses are deducted from their gross incomes… traditional taxi companies and [delivery] drivers have been driven to the verge of bankruptcy…
“For the small minority of people who have used Uber and Lyft’s subsidized rides, most of them younger, college-educated, better-off Americans (their use is double the rate of less-educated, lower-income people), this transportation option has been helpful. But for the vast majority who do not use these companies’ services, and who ride the bus or drive personal vehicles stuck in congested traffic, ride hailing’s legacy has been decidedly negative. In short, ride hailing has been bad for most drivers, bad for the environment, bad for congestion and traffic flow, and bad for public transportation.”
Steven Hill, The American Prospect
“When workers don’t have access to paid sick leave, they are much more likely to come to work when sick, which risks spreading disease to co-workers and consumers. Researchers found that overall flu infection rates decreased by up to 20% in cities following the passage of paid sick leave policies… When companies like Uber and Lyft refuse to abide by AB5, the cost falls directly on workers and taxpayers. In a recent study, we found that Uber and Lyft should have paid $413 million into the state’s Unemployment Insurance Fund from 2014 to 2019. AB5 fixes this problem.”
Ken Jacobs, San Francisco Chronicle
“Uber and Lyft note that in surveys, the majority of drivers say they prefer the contractor model. But this elides the fact that most drivers log just a few hours per week or per month, while a smaller group of full-time drivers account for the vast majority of rides and hours logged on the app. Those full-time workers are effectively employees without any of the benefits of being employees…
“Central to the ride-hailing companies’ argument against the state law is that drivers would lose the flexibility they cherish — the ability to log into the app when they choose to see if there is a desirable fare. But labor experts say Uber and Lyft could classify drivers as employees while still providing them flexible work schedules. ‘There are countless companies that offer part-time work and a range of benefits based on how much you work,’ said William B. Gould IV, a Stanford University law professor and former National Labor Relations Board chairman. ‘What these companies have created isn’t innovation, it’s exploitation.’”
Greg Bensinger, New York Times
“[Michael Reich, a professor of economics at the University of California, Berkeley] pointed out that there are other transportation network companies (TNCs) that would quickly fill the gap in Uber and Lyft's absence. Wingz, Silver Ride, Executive Ride, and Nomad Transit are a few that have permits to operate in California. ‘I would expect to see more business if Uber and Lyft pull out of California,’ Christof Baumbach, the CEO of Wingz, told Salon in an emailed statement, adding that Wingz has a different approach than Uber.”
Nicole Karlis, Salon
