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Category: Independant Contractors

PROP 22 WAS A FAILURE FOR CALIFORNIA’S APP-BASED WORKERS. NOW, IT’S ALSO UNCONSTITUTIONAL.

Posted on by Brian Chen and Laura Padin
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In a landmark decision, the Alameda Superior Court of California recently ruled that Proposition 22, the ballot initiative that excluded many app-based workers from foundational labor laws, violates the California constitution and must be struck down in its entirety.

The decision, which will undoubtedly be appealed by the app-based companies, represents a huge setback in the companies’ power grab to rewrite U.S. labor laws and exempt themselves from labor standards that apply to all other employers. It also represents an important advancement in the gig-worker-led movement for living wages, rights at work, employment benefits, and the right to exercise collective democratic power. 

What Was California’s Prop 22?

California’s Prop 22 was a ballot initiative led by app-based companies such as Uber, Lyft, and DoorDash to exclude ride-hail and food-delivery app-based workers from nearly all employee rights under state law, including the right to a minimum wage, time-and-a-half for overtime, expenses reimbursement, and benefits such as unemployment compensation and state workers’ compensation.

The companies developed the ballot initiative in response to the California legislature’s passage in 2019 of AB5, a simple and straightforward test for determining who is an employee and who is an independent contractor. Although Uber and Lyft ride-hail drivers and DoorDash, Instacart, and Postmates food-delivery workers are clearly employees under the AB5 test, these companies steadfastly refused to comply with the law and continued to deny their workers the rights and benefits to which they are entitled as employees.

As state and local officials sued Lyft, Uber, DoorDash, and Instacart to get them to stop violating the law, the companies spent a whopping $224 million on Prop 22. Among the provisions included in Prop 22 were an inferior set of benefits that the companies agreed to provide their app-based workers. And, worst of all, Prop 22 could only be amended by a seven-eighths vote of the state legislature, making its provisions virtually impossible to repeal or change.

To get Prop 22 passed, Uber and Lyft bombarded television, social media, and their own workers with pressure tactics and deceptive advertising, including the flat-out false claim that Prop 22 would increase, not decrease, workers’ rights. As a result, one survey of California voters founds that 40 percent of “yes” voters thought they were supporting gig workers’ ability to earn a living wage. [1] Other voters said they did not realize they were making a choice between guaranteed rights and protections through employment and “an arbitrary set of supplemental benefits . . . designed by the gig companies.” [2]

Uber also adopted a new cynical marketing slogan—“If you tolerate racism, delete Uber”—to claim solidarity with the Black Lives Matter movement while, at the same time, seeking to enshrine a second-class employment status for California’s ride-hail and food-delivery app-based workers, who are overwhelmingly people of color and immigrants, in what legal scholar Veena Dubal has called a “new racial wage code.”[3] Dubal writes: “By highlighting particular forms of racial subjugation, while ignoring and profiting from others, the corporate sponsors of Prop 22 successfully concealed the very structures of racial oppression that [Prop 22] entrenched and from which companies benefit.”[4]

What Happened After Prop 22 Passed?

After Prop 22 passed, and app-based workers were stripped of their employee rights, the benefits package that the companies offered in exchange proved to be a mirage. In order to qualify for a promised healthcare stipend, for example, app-based workers need to a purchase a covered policy in advance and get enough work hours to qualify for the stipend; if they don’t, they must pay the full cost of the premium.[5] One survey of app-based workers found that only 15 percent have applied for the healthcare stipend.[6]

And, despite the companies’ claims of guaranteed earnings, pay decreased for many ride-hail and food-delivery drivers after Prop 22 passed. According to Peter Young, an app-based ride-hail and food-delivery driver for years, incentives offered to drivers disappeared after Prop 22 passed, and he experienced cuts to his base pay and unpredictable fluctuations in income.[7] Ben Valdez, an Uber driver, similarly said that pay continues to vary widely, and that he averages about $150 per day before expenses for 12 to 15 hours of work—well below California’s $14 minimum wage.[8] In fact, a study by labor economists found that Prop 22 guarantees a minimum wage of only $5.64 per hour after expenses and waiting time are taken into account.[9]

Even the companies’ central claim—that excluding their workers from employee rights and benefits is necessary to keep their prices affordable—proved to be false. A month after Prop 22 passed, both DoorDash and Uber Eats announced price hikes, a move the workers’ advocacy group Gig Workers Rising decried as a “corporate bait and switch.”[10]

The aftermath of Prop 22 made clear that its sole objective was to insulate app-based companies’ business model from any legal or worker challenge, so the companies could once and for all pass costs onto workers and consumers in a last-ditch attempt at profitability.

Why Did the Court Ruling Find Prop 22 Unconstitutional?

In his ruling that Prop 22 is unconstitutional and unenforceable, California Superior Court Judge Frank Roesch found that the ballot initiative infringes on the power explicitly granted to the California Legislature to regulate workers’ compensation.[11] Prop 22 also included language that prevents the state legislature from passing laws that allow app-based workers to unionize, which the court ruled violated a constitutional provision requiring that ballot initiatives be limited to a single subject.[12] The court also took issue with the substance of this provision, noting that preventing app-based workers from organizing “does not not protect work flexibility, nor does it provide minimum workplace safety and pay standards for those workers. It appears only to protect the economic interests of the network companies in having a divided, ununionized workforce.” [13]

What’s Next Now That Prop 22 Is Unconstitutional?

The app-based companies will appeal the court’s decision, and they will ask for a stay of the ruling while the appeal is pending. If granted, it means that Prop 22 would remain in effect—and app-based drivers and food-delivery workers would continue to be excluded from most state labor rights and benefits—through the appeals process, which could take a year or longer.[14]

What Other States Face Legislation Like California’s Prop 22?

Regardless of the final outcome in the Prop 22 case, app-based companies will continue to spend millions to fund legislation and ballot initiatives that would make it easier for them to avoid accountability as an employer and to depress wages and working conditions for their app-based workers. Their CEOs have made clear that Prop 22 is their model legislation across the country.[15]

In Massachusetts, for example, Uber, Lyft, and DoorDash are funding another ballot initiative to rewrite labor laws to benefit themselves and enshrine independent contractor status for their app-based workers.[16] The push for a ballot initiative comes after Massachusetts Attorney General Maura Healey sued Uber and Lyft for misclassifying their drivers as independent contractors. It appears that the companies, having determined that their likelihood of winning in court is low, have decided it will be easier to simply rewrite the law.

Prop 22–like legislation does not just hurt workers who currently obtain work through apps and other online platforms. At risk is virtually any worker whose job functions can be “gigged out” piecemeal on an app.

Luckily, the aftermath of Prop 22 mobilized app-based workers more than ever, and they are fighting back. In Massachusetts, workers’ rights groups and community organizations launched the Coalition to Protect Workers’ Rights, which aims to “combat Big Tech companies’ campaign to undermine the rights and benefits of their workers.”[17] In New York, a coalition of workers’ rights organizations defeated a state bill pushed by app-based companies that would have created a top-down collective bargaining structure for ride-hail and food-delivery app-based workers while excluding them from nearly all state and local labor rights and protections.[18]

This progressive change is due to the persistence and commitment of workers and their advocates. App-based workers are emboldened in the fight for equal rights, and they are just getting started.

ENDNOTES

[1] Faiz Siddiqui & Nitasha Tiku, Uber and Lyft Uses Sneaky Tactics to Avoid Making Drivers Employees in California, Voters Say. Now They’re Going National, Washington Post, Nov. 17, 2020.

[2] Id.

[3] Veena Dubal, The New Racial Wage Code, Hastings Law & Policy Review, at 3-4, Aug. 17, 2021, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3855094. According to one study of the San Francisco Bay Area in 2019, immigrants and people of color comprised 78 percent of Uber and Lyft drivers, most of whom relied on these jobs as their primary source of income. Chris Benner, Erin Johansson, Kung Feng & Hays Witt, On-Demand and On-the-Edge: Ride-hailing and Delivery Workers in San Francisco, University of Santa Cruz Institute for Social Transformation, May 5, 2020, at 2 https://transform.ucsc.edu/wp-content/uploads/2020/05/OnDemandOntheEdge_ExecSum.pdf.

[4] Id. at 20.

[5] Megan Rose Dickey, California Gig Workers Say Prop. 22 Isn’t Delivering Promised Benefits, Protocol, May 25, 2021, https://www.protocol.com/policy/gig-workers-prop-22-benefits.

[6] Tulchin Research, April 20, 2020

[7] Michael Sainato, ‘I Can’t Keep Doing This’: Gig Workers Say Pay Has Fallen After California’s Prop 22, Guardian, Feb. 18, 2021,

[8] Id.

[9] Ken Jacobs & Michael Reich, The Uber/Lyft Ballot Initiative Guarantees Only $5.64 an Hour, UC Berkeley Labor Center, Oct. 31, 2019, https://laborcenter.berkeley.edu/the-uber-lyft-ballot-initiative-guarantees-only-5-64-an-hour-2/.

[10] Eve Batey, That Price Hike That Delivery Apps Threatened If Prop 22 Failed? It’s Happening Anyway, Dec. 15, 2020, https://sf.eater.com/2020/12/15/22176413/uber-eats-doordash-price-hike-fee-december-prop-22

[11] Castellanos v. California, Case No. RG21088725, at 2-4 (Alameda Co. Sup. Ct. Aug. 20, 2021).

[12] Id. at 10-11.

[13] Id. at

[14] Suhauna Hussain, Prop 22. Was Struck Down; Will the Ruling Stick? Uber and Other Gig Companies Plan to Appeal; It Could Drag on for More Than a Year, L.A. Times, Aug. 26, 2021.

[15] Faiz Siddiqui, Uber Says It Wants to Bring Laws Like Prop 22 to Other States, Washington Post, Nov. 5, 2020, https://www.washingtonpost.com/technology/2020/11/05/uber-prop22/.

[16] Nate Raymond & Tina Bellon, Groups Backed by Uber, Lyft Pushes Massachusetts Gig Worker Ballot Initiative, Reuters, Aug. 4, 2021.

[17] Grace Pham, The Launch of a New Coalition: Protecting the Rights of Gig Workers in Massachusetts, Massachusetts Jobs with Justice, June 29, 2021, https://www.massjwj.net/blog/2021/6/29/the-launch-of-a-new-coalition-protecting-the-rights-of-gig-workers-in-massachusetts

[18] Edward Ongweso Jr., A Plan to Tame Labor Unions for Uber and Lyft Has Been Scrapped in New York, Vice, June 9, 2021.

About the Author: Brian Chen is a staff attorney at the National Employment Law Project. Brian focuses on combating exploitative work structures that subordinate workers in low-wage industries. Brian is admitted to practice law in New York and is a proud member of the NELP Staff Association, NOLSW, UAW, Local 2320.

About the Author: Laura Padin joined NELP in 2018 as a senior staff attorney for the Work Structures Portfolio. Laura’s work focuses on policies that improve workplace standards and economic security for the contingent workforce, including temporary workers and workers in the “gig economy.” Laura is a proud member of the NELP Staff Association, National Organization of Legal Services Workers, UAW Local 2320.

This blog originally appeared at NELP on September 16, 2021. Reprinted with permission.


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VOTERS SUPPORT HOLDING CORPORATIONS ACCOUNTABLE FOR LABOR CONTRACTING ABUSES

Posted on by Rebecca Smith
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Recent polling confirms that voters who live in battleground districts overwhelmingly want their Congressional representatives to hold corporations accountable to the workers who build their business and their wealth. Voters want legislators to make it harder for companies to call workers “independent contractors”; they want lawmakers to discourage companies from contracting with temp and staffing agencies and shedding responsibility for their workers.

Between January 22 and February 1, 2021, Hart Research Associates polled voters in the nation’s 67 most competitive Congressional districts. Across political parties, regions, race, genders, age groups, education levels, and income levels, there is broad understanding that policymakers should address the rampant contracting out of jobs.

Fully 72% of voters are in favor of passing legislation that would “allow workers to hold lead companies legally responsible if their subcontractor fails to make Social Security, unemployment insurance, or workers’ compensation contributions, or fails to pay workers the wages they are owed according to prevailing minimum wage and overtime laws.” Both white voters (73%) and people of color (70%) support such legislation. Democrats especially favor such legislation (83% support), but both Independents (60%) and Republicans (66%) also endorse legislative action.

Seven in ten voters (70%) believe that eliminating permanent jobs and instead using workers from temporary or staffing agencies is a bad change in the workplace, with a third of voters regarding this as a very bad change.

And by a dramatic 40-point margin, 54% to 14%, voters think that businesses designating more workers as independent contractors, instead of hiring them as employees, is a bad change rather than a good change for the workplace. A strong majority (68%) of battleground voters favors legislation that would make it harder for companies to classify workers as independent contractors, including increasing the fees and penalties for companies that misclassify employees as independent contractors. Seventy-six percent of voters of color supported the new legislation; 66% of white voters also favored it, as did 79% of Biden voters and 58% of Trump voters.

NELP’s prior research shows that Black, Latinx, Asian/Pacific Islander, and Native American workers are overrepresented in misclassification-prone sectors, such as construction, trucking, delivery, home care, agricultural, personal care, ride-hail, and janitorial and building services, by over 36 percent; they constitute just over a third of workers overall, but between 55 and 86 percent of workers in home care, agricultural, personal care, and janitorial sectors.[1]

NELP’s results come on the heels of polling by McKinsey that finds that contract, freelance, and temporary workers would overwhelmingly prefer to have permanent employment. In particular, people of color stated a strong preference for stable jobs. Together, the two polls make clear that excluding certain workers from labor protections—exclusions that are rooted in white supremacy and segregation—has profound implications for racial justice.

The poll results make clear that lawmakers should resist efforts by Uber, Lyft, Doordash, Instacart, and others to gain special exemptions from foundational labor rights, both across the states and in intense lobbying to gain special exemptions from federal legislation known as the Protecting the Right to Organize (PRO) Act—which, if passed, would be the most consequential expansion of the right to organize that workers have seen in decades. These businesses and others that make up the misleadingly named “Coalition for Workforce Innovation” are attempting to convince lawmakers that workers prefer being relegated to second-class status. The polling data shows that these claims are false.

…people across the country are demanding that their elected representatives ensure that foundational labor rights apply to all people who work for a living, and that foundational obligations apply to businesses that contract out.

Instead, people across the country are demanding that their elected representatives ensure that foundational labor rights apply to all people who work for a living, and that foundational obligations apply to businesses that contract out. NELP applauds efforts by the Biden administration, Congressmembers, and policymakers in states and cities who are working towards this goal.

This blog originally appeared at NELP on June 15, 2021. Reprinted with permission.

About the Author: Rebecca Smith is the director of the Work Structures Portfolio at NELP. She joined NELP in 2000, after nearly 20 years advocating for migrant farm workers in Washington State.


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UBER’S NEW GIG WORKER BILL IS THE SAME OLD TRICK: DEREGULATION AND SPECIAL TREATMENT FOR EXPLOITIVE COMPANIES

Posted on by Brian Chen
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In New York State, legislators are reportedly considering a bill, brokered by gig companies including Uber and Lyft, that would remove app-based drivers and food delivery workers from virtually all labor and discrimination protections. Though its supporters are selling this “Right to Bargain Act” as a novel form of bargaining in the app-based economy, there’s nothing new about this anti-worker bill. It’s straight out of a well-worn playbook for companies like Uber, Lyft, Handy, DoorDash, and Instacart: Subvert labor laws, undo industry regulations, and duck accountability to workers and the public.

New York’s “Right to Bargain Act”

As drafted, the bill would permit certain unions, if certified by 10% of “active network workers” in each industry, to exclusively represent ride-hail drivers and delivery workers at an “industry council,” where they would negotiate with the companies over a set of bargaining topics.

After reaching an agreement, and if a majority of workers who vote approve the agreement, a state board would accept (or modify) the recommendations, and then implement and supervise the agreed-upon terms across the industry.

While “sectoral bargaining” can deliver improved labor standards in the right context, there are serious flaws built into the New York bill: It precludes some member-led groups that have organized app-based workers from representing workers in bargaining; there is no mechanism for rank-and-file workers to democratically participate throughout the bargaining process; and strikes and work stoppages are explicitly banned. Each of these provisions seriously calls into question whether workers could ever build and bring power to bear on the bosses sitting across the bargaining table.

Even more troubling about the legislation is that, in exchange for this bargaining system—compromised as it is—drivers and delivery workers would be unable to access any rights or protections under any New York state or local law. Gig companies would be free of any obligations to their workers under state labor law, disability law, paid family leave, paid sick leave, and city and state human rights law.

The companies would evade accountability even if a court finds their workers to be their employees, as they already have under certain laws in New York and around the country. That means a workforce of mostly underpaid immigrant workers and people of color in New York would be permanently excluded from foundational labor standards.

Worse yet, cities would lose the ability to legislate improved working conditions in the app-based economy. Even existing protections, like New York City’s Taxi and Limousine Commission (TLC) rules that create a pay floor for ride-hail drivers, would be dismantled. Under the proposed New York bill, Uber and Lyft drivers could start anew and bargain up—but only from half their current pay.

A Longer History of Anti-Worker Deregulation

Many have compared the New York bill to Proposition 22, a 2020 California ballot initiative that removed nearly all employment protections from app-based transportation and food delivery workers in exchange for newly-created “benefits” that already have proven illusory and mostly inaccessible to workers. The similarities, obviously, are there. But the roots of the New York bill go back further.

Ever since heralding the app-based economy in 2008, Uber and its peer companies have sought to preserve their business model—essentially, an illegal practice of misclassifying their workers as independent contractors to save as much as 30% of labor costs—by lobbying aggressively to rewrite the law to their satisfaction. More than anything else, the companies want to preserve the legal fiction that their workers are not employees—in order to profit off of their exploitation.

In 2014, Uber launched a national effort to pass state laws locking ride-hail drivers into independent contractor status, denying them their employee rights. The bills, which passed in more than forty states between 2014 and 2017, ushered in a wave of ever-worse carveout policies.

Newer state bills, this time pushed by the domestic work company Handy, created labor law exclusions for “marketplace contractors” across platforms such as Uber, Handy, and Postmates. In Texas, gig company lobbyists skipped the legislature entirely and targeted the state’s unemployment board in 2019 to implement a rule that disqualifies from unemployment insurance (UI) payments any worker dispatched through an app.

And yet, workers pushed back.

In recent years, ride-hail drivers, delivery workers, and other misclassified workers organized to fight for better working conditions. More than that, they started winning. The New York Taxi Workers Alliance led organizing and protests that eventually led to the creation of minimum pay for Uber and Lyft drivers in New York City in 2018. The next year, app-based workers mobilized support to push California legislators to enact Assembly Bill 5, a law that presumes that most people in the state are entitled to employment protections.

The Gig Companies’ “Third Way”

In the face of successful worker organizing, losses in court, and increasing public support of workers over the past couple years, the app companies pivoted: If they were to hold onto an exploitive business model, something had to give. Instead of outright denying unjust working conditions, they’d have to co-opt the language of workers’ rights and concede some limited benefits on the margins—while preserving the ultimate goal to exempt themselves from nearly all employer rules (see Prop 22 as Exhibit A).

…the app companies pivoted: If they were to hold onto an exploitive business model, something had to give. Instead of outright denying unjust working conditions, they’d have to co-opt the language of workers’ rights and concede some limited benefits on the margins…

At the same time, in the summer of 2020, the country erupted over the murder of George Floyd. Rather than paying a living wage or providing paid leave to a disproportionately poor, racialized workforce, the gig companies commodified the movement for Black lives. Uber, in particular, put its resources into this strategy—“If you tolerate racism, delete Uber”—to obscure the economic and racial subjugation of its drivers.

After winning their Prop 22 campaign in California, the companies had found their new approach: A “third way” between overt corporate extraction and full employment rights for their workers—veiled in the language of racial justice. Uber soon began pressuring the federal government to create a new system of regulation: A “third worker category” that would grant some limited benefits—such as a portable benefits system—while forever locking workers out of employment protections.

New York’s “Right to Bargain Act” is just that: A “third way” proposal—this time dressed up in a veneer of “collective bargaining”—that would excuse app-based companies from any accountability to their workers or to public social insurance funds.

And if this bill passes in New York, expect the companies to ramp up their efforts to derail the Protecting the Right to Organize (PRO) Act in the U.S. Congress and lobby for a “third worker category,” coordinated by the corporate mega-alliance the Coalition for Workforce Innovation.

Deregulation at that national scale doesn’t only concern workers in the so-called “gig economy,” it means degraded working standards and conditions for all of us, creating a legal avenue for any company to “gig” out its workers.

Deregulation at that national scale doesn’t only concern workers in the so-called “gig economy,” it means degraded working standards and conditions for all of us, creating a legal avenue for any company to “gig” out its workers.

Behind their “flexibility” and “new benefits” sleight-of-hand, the gig companies’ “third way” policies really are the same old trick: Corporate redistribution of billions of dollars from the poor and working class to the ruling elite.

Conclusion

After the companies’ long history lobbying against workers’ rights, legislators in New York and across the country should reject outright any proposal that has had input from companies like Uber, Lyft, or DoorDash. It is, instead, the workers on the streets—organizing for equal rights, better pay, and just labor standards—who must lead the way forward.

This blog originally appeared at Bloomberg Law on June 2, 2021. Reprinted with permission.

About the author: As a staff attorney at the National Employment Law Project, Brian focuses on combating exploitative work structures that subordinate workers in low-wage industries. Through litigation and policy campaigns, he supports workers’ efforts to build power at their workplace.


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BREAKING: Draft Legislation in New York Would Put Gig Workers into Toothless ‘Unions’

Posted on by Joe DeManuelle-Hall
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An effort backed by the New York State AFL-CIO would create a new bargaining scheme for app-based workers without addressing the question of whether or not these workers are legally “employees.”

Labor Notes obtained a draft version of the legislation that is being negotiated by unions and app employers.

Workers for apps like Uber, Lyft, and DoorDash are currently considered independent contractors; most in the labor movement consider them misclassified, a tactic the companies use to avoid paying the full cost of benefits. These workers are blocked from unionizing by antitrust laws, and don’t have the protection of the National Labor Relations Board (or many other protections).

To sidestep this, the draft legislation would enact a new process to recognize unions and bargain agreements—relying on the state government to enact the negotiated “recommendations” as regulations.

But the draft bill includes much to give labor activists pause, and marks a departure from the national push against misclassification.

“It’s about creating a distraction and a real carve-out from the PRO Act,” said Bhairavi Desai, director of the New York Taxi Workers Alliance.

The federal PRO Act, which much of the labor movement is pushing for, would sidestep the question of misclassification but allow independent contractors to unionize under certain conditions using the National Labor Relations Act.

New York State Senator Jessica Ramos, chair of the Labor Committee, has just released a statement that she will not be backing the draft bill because “We will not legitimize any company union. We will not undermine the PRO Act.”

THE BIG UGLIES

We don’t know what would end up in the final legislation. But the biggest immediate concerns fall into two major categories: departures from existing labor law, and lessening local regulatory power over gig companies.

This legislation says that workers would be put into a union that they likely never voted for, and which would not be funded by workers, and barred from putting up any serious fight for an agreement—no strikes, no boycotts, no picketing. It would create a new type of legally recognized union which is not financially accountable to its members. This should be deeply concerning to those who care about building powerful, democratic unions.

This draft legislation would also take away local governments’ power to rein in gig employers—New York localities could no longer create specific minimum wages for app workers or rules about their working conditions. What’s more, cities would lose the ability to legislate about these companies at all. Local governments couldn’t create taxes or surcharges on the services, or rules for how they must operate. NYC already has a cap on the number of rideshare drivers; this would be thrown out. If a local government wanted to put a surcharge on rides or deliveries to fund infrastructure, or green jobs, or schools—it couldn’t. This power would rest solely with the state.

This type of legislation is not entirely new, but this may be the furthest it’s gotten. Two years ago, as California legislators were preparing Assembly Bill 5 to rein in misclassification, Uber and Lyft were approaching major unions, including SEIU and the Teamsters, in an attempt to preempt the legislation with a compromise. When that didn’t work, the companies spent hundreds of millions of dollars on last fall’s ballot measure, Proposition 22, to carve themselves out. They won, and they’ve made no secret of their intention to get the same deal in other states.

Now, up against the might of these incredibly powerful companies, some labor leaders are looking for compromise legislation of their own. What’s in it for the apps? Legislation like this could help siphon off labor organizing energy and undermine campaigns for tougher legislation.

TWO MASSIVE UNITS, ONE UNION EACH

The legislation covers app-based workers in two groups: rideshare drivers, who perform on-call taxi service for companies like Uber and Lyft; and delivery workers, who deliver packages, groceries, and restaurant orders for companies like Instacart, Amazon, DoorDash, and Seamless. Each of these two groups would become a massive, statewide unit. The draft bill sets up a process (detailed below) for one union to cover each group.

Rideshare companies employ around 80,000 drivers in New York City alone, a figure that is currently capped by local legislation. The number of delivery workers is less clear, but would include between 50,000 and 80,000 food delivery workers as well as Amazon “Flex” drivers and probably others.

The likely unions—based on who’s been pushing this legislation—would be the Machinists’ Independent Drivers Guild for the rideshare drivers, and the Transport Workers Union for delivery workers. The IDG already claims to represent the 80,000 app-based drivers in New York City, but this would formalize its role. The Machinists’ project has come under scrutiny for receiving money from Uber.

RECOGNITION

The recognition process relies in part on labor peace agreements—familiar in places like construction and the burgeoning cannabis industry. Here, the agreement requires companies to sign a peace deal with a union that meets certain requirements; the union is then restricted from encouraging any “picketing, strikes, slow downs, or boycotts” until a finalized deal has been ratified by the state.

The unions only have to show signed cards of support from 10 percent of the workers in the unit—there’s no election. (What if more than one union shows interest? It reads as an afterthought; the labor commissioner is supposed to come up with a process in that case.) Contrast that with the union authorization process run by the National Labor Relations Board, where 30 percent of workers must sign union cards to trigger an election, which can even include competing unions on the same ballot.

Under the draft law, the state ultimately gets to decide if the union should be recognized—because, in addition to the 10 percent show of support, the union must have “demonstrated experience in representing network workers or other related workers in reaching agreements with companies for at least five years.” (“Network” is being used here as a synonym for “app.”)

This puts significant power in the hands of the commissioner of the state’s Department of Labor, appointed by the governor, to determine whether or not a union is eligible to represent workers. This could lead to competing worker organizations being disqualified. The Taxi Workers Alliance, for example, is not a formal union in the legal sense, though it has members and strikes; it’s unclear whether it would meet the standard of “reaching agreements.”

“We read that as they want to make sure TWA is locked out,” Desai said. “It’s meant to favor—that’s not even strong enough—IDG and it’s meant to get rid of us.”

Service Employees Local 32BJ has been supporting the Worker’s Justice Project, a worker center, in its campaign to organize app-based delivery drivers—but will the state say that WJP or even SEIU has the requisite experience representing “network” workers?

Getting rid of or changing the union would require a much more significant lift, and an election. Thirty percent of workers would have to say they wanted a decertification election, and a majority of all workers (not just those voting) would have to vote to decertify. If they wanted a different union, workers would have to go through the process of showing 10 percent support again (after decertifying the existing union), and have the state “certify” their organization.

WHAT’S THE DEAL?

Once a union was certified, the rideshare companies would bargain together for one agreement, and the delivery companies would bargain a separate one, each across the table from the chosen union. The draft legislation demands that the negotiators bring state representatives a deal covering a handful of topics, including union access to workers and a minimum five-year agreement.

The two most remarkable topics they would negotiate are a “portable benefits fund” and the minimum wage for drivers. Portable benefits is a vague term that can mean a lot of different things that aren’t tied to a specific job—anything from Social Security to privatized unemployment insurance for misclassified workers. Here, the union and the employers are told to set up a nonprofit and negotiate how much money to send its way, though the legislation doesn’t say anything about what benefits this should cover. Unemployment? Workers compensation? Family leave? It would be up to them to figure that out. Many of these things are mandated for W-2 employees by laws that don’t cover independent contractors.

The wage negotiations are supposed to have a “floor,” consisting of a local minimum wage plus a mileage rate. The kicker, though, is that these only cover active time—that is, time the workers spend performing the job. App workers have long complained about unpaid idle time while they’re waiting for dispatch—this was a big push for California’s Assembly Bill 5, and NYC passed a driver minimum wage that covered inactive time (more on this later).

NO DUES, BUT LOTS OF CASH

The draft legislation provides a direct line of funding for the unions involved, in the form of surcharges. Each ride in an Uber or food delivery by an Instacart worker would have a 10-cent surcharge, paid by the customer, which companies would collect and then hand over to the unions.

This doesn’t necessarily preclude unions from setting up dues and membership structures, but it does provide them a huge pot of money without having to do that. Right before the pandemic, rideshare companies were hitting 750,000 rides a day in New York City. So the rideshare union would get $75,000 per day—almost $27.5 million per year—just from NYC, even before you figure in all the drivers in the rest of the state.

PROGNOSIS

The New York legislature is only in session for a little less than two weeks, leaving a small window for this to pass this year. The IDG has tried to pass similar legislation over the past several years, but this time it is opening the door to the support of another union by including a separate unit of delivery workers.

Similar legislation was floated recently in Connecticut, before it was allegedly shut down by the national AFL-CIO—in part because of its contradictions with the federal PRO Act, which would provide many misclassified “independent contractors” the right to organize and bargain under the National Labor Relations Act.

As app-based employers continue to grow in size and power, they will keep looking for creative new ways to undermine labor law. Unfortunately, it’s all too easy for them to find allies in labor who are willing to gamble away workers’ rights for the promise of quick, massive membership increases.

This blog originally appeared at Labor Notes on May 21, 2021. Reprinted with permission.

About the author: Joe DeManuelle-Hall is a staff writer and organizer at Labor Notes.


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Surveillance, Stress, and No Bathrooms: Life as an Amazon Driver

Posted on by Jake Alimahomed-Wilson
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Part 2 of a series on Amazon’s delivery drivers. Part 1, “Building Its Own Delivery Network, Amazon Puts the Squeeze On Drivers,” is here.

The Amazonification of logistics has created a new group of highly exploited workers: delivery drivers. Amazon itself increasingly relies on an expanding network of subcontracted drivers and independent contractors to deliver packages to customers’ doors.

The working conditions facing Amazon’s last-mile drivers are defined by a frantic pace, low wages, and relentless pressure to meet tight delivery deadlines. Workers of color and immigrants are overrepresented, as they are in all the lowest-paying segments of last-mile logistics. 

When an Amazon Prime member orders an item, the first step in the delivery process begins at an Amazon Fulfillment Center, where the item is picked by a worker and put into a box, and an address label is created.

From there, the package is typically sent to an Amazon Sortation Center, where it is sorted. Then it’s sent either to the post office or, increasingly, to an Amazon Delivery Center, where Amazon’s subcontracted Delivery Service Provider (DSP) drivers pick up their routes.

Each Amazon Delivery Center typically contracts with 12–20 DSPs. Most of the drivers I spoke with said they usually have the same daily route. As the workday starts at the delivery center, hundreds of drivers pick up their “racks”: pallets of Prime packages. Any package that arrives at a delivery center must be delivered that day.

‘WATCHING ME DRIVE’

To get a sense of what work is like for these subcontracted drivers, I accompanied 30-year-old Miguel on some of his shifts throughout the Los Angeles region. Miguel is an undocumented immigrant; he was born in Mexico and migrated to the U.S. as a baby in the early 1990s. He grew up in L.A. and worked in fast food for 10 years before becoming a delivery driver.

Miguel typically works four 10-hour shifts each week, with an occasional opportunity for an extra day of overtime. He earns $15.50 per hour and receives no health benefits. While Amazon is not technically his employer, Miguel exclusively delivers Amazon Prime packages.

Miguel’s shift starts at 7:30 a.m., when he picks up his “bag.” A driver’s bag contains the keys to the delivery van and an Amazon “Rabbit” delivery device.

The Rabbit is an Android smartphone, which tracks the driver’s movements in real time and dictates each step of the delivery route. It provides information on each delivery, access codes to enter apartment buildings, and notes on where to leave packages.

The Rabbit also gives the driver information about the Prime customer (name, address, phone number) and the size of each package. As soon as a package is delivered, the driver must take a picture to prove it.

“The Rabbit stresses me out,” Miguel said. “I’m constantly staring at it and thinking someone at Amazon is constantly watching me drive.”

Once Miguel finds his van in the parking lot, he proceeds to the Amazon Delivery Center and waits for his rack. There’s a long line of other DSP drivers also waiting. Each rack has between 225 and 350 packages.

On one particular day I joined him, Miguel’s rack contained 227 packages, amounting to 161 stops. A driver typically puts all the small envelopes and packages up front in the cab and leaves the large boxes in the rear of the van. Since I was riding in the front seat, I had to hold dozens of small packages on my lap.

If drivers finish their shifts early, the DSP may assign them as “rescue drivers” to assist others who have fallen behind on their delivery routes.

CONSTANTLY RUSHING

“One thing that can be stressful is that my boss always knows exactly where I am because of the Rabbit,” Miguel told me. “So if I am behind on my route they tell me about it… They call me on the radio and tell me to hurry up.

“On most days, I don’t even have time to take a full lunch break, so I just go to a drive-through. And if I’m lucky I’ll just eat in the van as I am working… You are constantly rushing. You can’t find parking, or the Rabbit gets screwed up…

“I’ve also been accused of stealing packages, especially in rich white neighborhoods. They see a Hispanic driving around and think I am a package thief. My [company] will soon be giving us Amazon-branded uniforms and blue Amazon vans, which I’m happy about because that will help people realize that I am not a porch pirate…

“Also, I wish we got paid more. I think we deserve it. I work really hard and I don’t have health benefits, so if I get sick or hurt, I have to pay out of pocket.”

Miguel and many other drivers I interviewed emphasized that it is Amazon, not the DSPs, that needs to pay better wages.

Drivers described a physically demanding work environment. They feel pressured to drive at dangerous speeds, blow stop signs, and skip breaks and meals to meet the tight deadlines. Traffic and congestion stress them out. They also reported safety violations, wage theft, intimidation, favoritism, and a lack of overtime pay.

“I lost over 30 pounds since I started this job,” said Rogelio, a 26-year-old Latino driver. “This job takes a lot of running… I twisted my ankle stepping off a curb a couple months ago… it really slowed me down. I had to keep working though, but it was really swollen.”

Rogelio told me that he only stops to use the bathroom once per shift, usually at the same public toilet near a park along his route. “During Prime week,” Rogelio said, “I was way behind on my route. All I ate that day was a granola bar and an apple—for almost 11 hours! I hate Prime Day.”

‘ONE PACKAGE COST ME $150’

When a DSP driver fails to deliver a package, or even when a package is stolen from the doorstep of a customer’s home, Amazon contacts the DSP with what drivers call a “concession.”

Concessions occur when Amazon Prime members submit a complaint to Amazon over a missed delivery. When a concession is issued, the individual driver is reprimanded by a superior.

Alex is a 37-year-old Latino driver who has been working for his DSP for 10 months. He told me, “Amazon put a concession on me a few months after I started. My boss called me in, and he asked why I didn’t take a picture of the package that disappeared. I told him that I did, but for some reason it didn’t get logged by the Rabbit. I was written up [by my boss] and he took away one of my shifts that week as punishment. That one package cost me 150 bucks.

“For the next few weeks, my boss tightened the screws on me… He was always on me, calling and texting me to hurry up… When an item gets stolen, they blame the drivers.”

“Here’s the thing,” Justin, a Filipino driver, told me. “I’m 42 years old. I have four kids and I make $15 an hour. I get about $1,250 every two weeks. That’s not enough to make it out here in LA. If I didn’t have a family, I’d leave this area.

“I basically do the same work as a UPS driver, but those guys get paid double what I earn, at least. We don’t have representation with any union. So that’s why I take as much overtime as possible, my boss knows I’ll take any extra work—but it’s a really tiring job at times.”

This blog originally appeared at Labor Notes on February 9, 2021. Reprinted with permission.

About the Author: Jake Alimahomed-Wilson is a sociology professor at Cal State-Long Beach. He is the co-editor, with Ellen Reese, of The Cost of Free Shipping: Amazon in the Global Economy (Pluto Press, 2020). This piece is an edited excerpt from the book. 


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New York City Drivers Cooperative Aims to Smash Uber’s Exploitative Model

Posted on by Hamilton Nolan
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Ken Lewis grew up on the island of Grena­da, and wit­nessed the pro­gres­sive after­math of its 1979 rev­o­lu­tion. ?“I remem­ber the pow­er of coop­er­a­tives, peo­ple get­ting land, turn­ing places that were bar­ren into pro­duc­tive places,” he says. That image stayed with him after he moved to New York City for grad school and start­ed dri­ving a taxi on the side. Now, sev­er­al decades lat­er, Lewis is final­ly get­ting a chance to put the pow­er of coop­er­a­tives into prac­tice, in ser­vice of the dri­vers he worked with for so long. 

He is one of three cofounders of The Dri­vers Coop­er­a­tive (TDC), which aims to real­ize a long-held dream of social­ly con­scious New York­ers in a hur­ry: a rideshar­ing app that you can feel good about. When it rolls out to the pub­lic ear­ly next year, TDC will become New York City’s first work­er-owned rideshar­ing plat­form?—?owned by the dri­vers them­selves, rather than by big investors and exec­u­tives. Its founders’ brazen idea is that TDC can actu­al­ly gain a com­pet­i­tive advan­tage over Uber and Lyft?—?sav­ing mon­ey and fun­nel­ing those sav­ings back to dri­vers?—?by doing away with the most exploita­tive prac­tices of that dom­i­nant duop­oly. ?“The way the [Uber] mod­el is orga­nized is extrac­tive. It takes out the mon­ey and doesn’t give back much. Imag­ine a com­pa­ny that doesn’t have any prof­its, but has cre­at­ed bil­lion­aires,” Lewis says. ?“That mon­ey comes from drivers.” 

Erik For­man, a vet­er­an labor activist and orga­niz­er, became inti­mate­ly acquaint­ed with the dark side of that extrac­tive mod­el when he was work­ing as a staff mem­ber at the Inde­pen­dent Dri­vers Guild, a union-affil­i­at­ed group that orga­nizes rideshare dri­vers in New York. Com­pa­nies that oper­ate in the indus­try reg­u­lar­ly push much of the risk of employ­ment onto the dri­vers by clas­si­fy­ing them as ?“inde­pen­dent con­trac­tors” rather than employ­ees. But they also push the costs of the job onto the work­ers, forc­ing them to pay for their own car and main­te­nance (not to men­tion things like health­care ben­e­fits). Instead of being paid to work, in oth­er words, rideshar­ing apps?—?like oth­er ?“gig econ­o­my” com­pa­nies?—?make peo­ple pay in order to work. When Uber launched in New York City in 2011, it was an attrac­tive alter­na­tive for many who had pre­vi­ous­ly been taxi dri­vers, with decent pay and lit­tle reg­u­la­tion. But in sub­se­quent years, Uber cut pay rates while the num­ber of dri­vers rose, leav­ing many who had tak­en out loans to buy cars for their job strug­gling to meet their debt oblig­a­tions and earn a living. 

For­man, who has been through bit­ter union bat­tles with big com­pa­nies, real­ized that for the same amount of effort, work­ers could prob­a­bly start their own ven­ture?—?lead­ing him to help cofound the rideshar­ing coop. ?“The indus­try seems unique­ly in need of a sys­tem change based on work­er own­er­ship,” he says. “[TDC] is not anoth­er com­pa­ny try­ing to get mon­ey out of dri­vers. It’s the opposite.”

In fact, the lack of exploita­tion is also The Dri­vers Cooperative’s finan­cial advan­tage. For one thing, the bil­lions of dol­lars that Uber has spent on mar­ket­ing the con­cept of rideshar­ing mean that TDC has lit­tle need for big ad bud­gets. Their plan is to grow by build­ing a net­work of dri­vers, using press and word of mouth. And while Uber and Lyft take around a quar­ter of the mon­ey from each trip (some of it to pay for all that mar­ket­ing), the coop plans to take only 15%. By com­bin­ing the pur­chas­ing pow­er of all the mem­bers, they hope to low­er expens­es on costs like gas and insur­ance?—?expens­es that Uber and Lyft dri­vers must han­dle on their own. They project that this should all add up to 8?–?10% high­er earn­ings for dri­vers on every ride, even while being able to beat their com­peti­tors on fare prices. And if the coop has any prof­its left at the end of the year, they will be paid out to dri­vers as dividends. 

Nobody under­stands the fun­da­men­tal con­trast with Uber’s busi­ness mod­el bet­ter than the third cofounder, Alis­sa Orlan­do?—?because she used to work for Uber. Her stint as the head of Uber’s oper­a­tions in East Africa left her dis­il­lu­sioned with the company’s preda­to­ry con­trol over its dri­vers, embod­ied in the way it uni­lat­er­al­ly cut earn­ings, deac­ti­vat­ed dri­vers alto­geth­er, or sad­dled them with unsus­tain­able car loans, all while claim­ing they were work­ing togeth­er. ?“We called dri­vers part­ners to the extent that it helped us” main­tain favor­able reg­u­la­to­ry sta­tus, Orlan­do says, ?“but they were nev­er partners.” 

Now she is using her expe­ri­ence in ven­ture cap­i­tal and plat­form-based busi­ness­es on behalf of TDC, a scrap­pi­er job that allows her to sleep bet­ter at night. Meet­ing with New York City dri­vers to recruit them into the coop, she’s heard count­less sto­ries of the impos­si­ble choic­es that dri­vers are forced to make?—?like the woman who said that a half dozen pas­sen­gers get into her car with­out a mask every week, but if she objects, they give her a low rat­ing. ?“She has to make this choice between ensur­ing that she’s safe, and the poten­tial threat of deac­ti­va­tion,” Orlan­do says. 

Moham­mad Hossen, a rideshare dri­ver who serves on the coop’s advi­so­ry board, says that the pan­dem­ic has act­ed as an accel­er­ant for the urgency of the new project. His income from dri­ving has fall­en by two-thirds, to just $100 a day, and costs for dis­in­fec­tant and oth­er safe­ty mea­sures?—?paid out of his own pock­et?—?have gone up. The shared predica­ment has allowed him to suc­cess­ful­ly recruit oth­er dri­vers, while they wait for hours at the air­port to get a fare. ?“At the end of the day, you have no life, no secu­ri­ty, no future,” Hossen says. ?“We real­ize that, and we suffer.” 

That could change when dri­vers are also the company’s own­ers. The Dri­vers Coop­er­a­tive is start­ing a pilot project this month giv­ing rides to work­ers for the Bronx-based Coop­er­a­tive Home Care Asso­ciates, an exam­ple of cross-coop coop­er­a­tion. Founders hope to even­tu­al­ly recruit sev­er­al thou­sand dri­vers in the city, and say recruit­ment is going well. They aim to roll out their own app and open for busi­ness in the first quar­ter of 2021. Their even­tu­al goal, they say, is 10% of the $5 bil­lion New York City rideshare mar­ket, and expan­sion into oth­er cities. For now, though, they will be sat­is­fied with mak­ing a good idea a reality.

This blog originally appeared at In These Times on December 10, 2020. Reprinted with permission.

About the Author: Hamilton Nolan is a labor reporter for In These Times. He has spent the past decade writ­ing about labor and pol­i­tics for Gawk­er, Splin­ter, The Guardian, and else­where. 


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Why companies based on gig work are hurting more than their employees

Posted on by Kyle Rowe
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Imagine that one of two people will be responsible for your safety. The first receives health and dental benefits, earns more than minimum wage, has clear advancement options within their company, and may even belong to a union. The second has no insurance benefits, works wildly erratic hours, feels no allegiance to their company, and makes less money. Which person would you pick?

The ride-share and micromobility industry is under the microscope for worker violations and safety concerns. Major shared e-scooter companies are facing lawsuits from injured riders. Revel, a moped company operating in New York City, recently reopened operations after a shutdown earlier this year, as complaints about reckless driving and fatalities involving its vehicles mounted. Ride-sharing companies Uber and Lyft face a number of lawsuits related to allegations by passengers of injury, assault, and harassment. A California ballot measure asking voters whether gig workers should count as employees has shown that many Americans are understandably focused on legal and legislative methods to introduce more order and security to the gig economy.

Like most startup industries, the companies providing these new mobility options are scrappy, doing things on the fly, and, at times, operating shortsightedly. This needs to change. As these forms of transportation edge their way to being a supplementary public transportation in a pandemic and beyond, we need to take this responsibility seriously.  After all, when the public gets on a bus, they don’t imagine the bus’s tires were changed not at a company-designated station but in someone’s garage.

Companies themselves would be wise to consider moving away from the gig economy and choosing to play a greater role in ensuring the well-being of their workers because doing so is fundamentally linked to the safety of their consumers and the success of their business.

Outdoor apparel giant Patagonia is famous for taking this approach: With generous time off, on-site child care, and the doors locked on weekends, the company has doubled in size since 2008 and is currently expanding into new markets. Employee turnover is minimal. CEOs and business school professors are increasingly aware that giving workers better wages and benefits also tends to be a recipe for greater profitability and employee retention in the long run.

Of course, any business has to keep an eye on the bottom line, but the damage done from rider injuries and safety lawsuits gives pause—financial pause, especially with potential liabilities tied up. But also pause because if you are hurting your customers, it’s not great for your brand. Investing in worker safety and well-being is more expensive in the short term, certainly. But in the long term, it leads to a more profitable company.

In 2019, my company, Spin, chose to make more than 90% of its workers employees with benefits, as opposed to contractors. In all markets our lowest starting wage is $15 per hour, with incremental increases based on tenure. We did this in part because research has shown that companies with healthy employees have better business performance. Companies with excellent safety, environment, and health programs outperform the S&P 500 by 3%-5%. But also because gig workers are less likely to have been thoroughly trained, more likely to leave for another job, and are often incentivized to cut corners in order to keep a high number of scooters on the streets and boost their own apparent productivity. This is unacceptable. Carefully training and fairly compensating the employees who work to keep our scooters safe for riders ensures that employees face no perverse incentives to rush through their work.

Safety out there also begins with safety in the home base. Designating our workers as employees with benefits—as opposed to contractors—allowed us to put protocols in place in both operations and maintenance and high standards endorsed by the Occupational Safety and Health Administration (OSHA). This operation would have been much less achievable with an ad hoc staff.

In order for companies in the ride-share and shared mobility space to truly unleash their potential, we must first gain public trust by improving the job we do on safety. Part of this will require that city planners and urban voters reimagine the nature of transportation infrastructure away from cars and toward biking, walking, and scooter transportation. It’s also vital that companies themselves give their workers every reason to do careful, excellent work in maintaining their fleets. As private-public partnerships create another way for people to move around, we need to make sure our workers are as supported as the workers behind transit agencies.

As the pandemic continues to demonstrate, the choice between safety and economic growth is a false reality, and companies should not pose these options against one another. At the end of the day, treating workers well is ultimately the safest choice for both businesses and their customers.

This blog originally appeared at Fast Company on October 27, 2020. Reprinted with permission.

About the Author: Kyle Rowe is the global head of government partnerships at Spin, the micromobility unit of Ford Mobility.


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Prop 22 is Bad for Black Workers

Posted on by Rashad Robinson
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When the pandemic forced Cherri Murphy to stop driving for Lyft, she applied for unemployment benefits like millions of other workers. But because Lyft has refused to pay into California’s unemployment insurance fund, insisting that its workers are independent contractors rather than employees, Cherri received zero dollars in unemployment benefits.

By day, Ms. Murphy is a member of Gig Workers Rising and a volunteer social justice minister who helps people connect their faith to the fight for racial justice. By night, she is a Black working woman in America, completing more than 12,000 Lyft rides, forced to play by rules designed for her — and millions of Black workers — to lose.

“Uber and Lyft drivers are mostly folks who look like me,” said Ms. Murphy. “We’re African American and people of color. We’re on the frontlines and among the hardest hit financially. But our bosses have offered us no meaningful protections, treating us as expendable as ever.”

Now, in the midst of a pandemic that is disproportionately hurting Black Americans, Uber, Lyft and other gig companies like DoorDash and Instacart are trying to roll back labor rights for app-based workers through a ballot measure called Proposition 22. That’s bad news for Black workers.

Supporters of Proposition 22 talk about innovation and jobs of the future, but there is nothing new about bosses attacking labor rights. Don’t be fooled by the misinformation campaign these companies are running — saying drivers must choose between flexibility and employee rights. Flexibility has always been at the discretion of the employer.

As a report co-authored by the Partnership for Working Families and NELP shows, Proposition 22 would lock app-based workers out of minimum wage and overtime protections, unemployment insurance, the right to form a union, and critical health and safety protections.

Proposition 22 would effectively cancel local COVID-19 emergency sick leave laws, passed in cities like San Francisco, Oakland, San Jose, and Los Angeles, that apply to app-based workers.

Bosses have always taken too much from Black workers. And U.S. labor laws have continuously failed Black workers, leaving them out of lifesaving labor protections. Economic inequality continues to this day, with Black women earning 62 cents on the dollar, and Black families having on average one-tenth of the wealth of white families. Union membership dramatically reduces that wealth gap.

The failed response to COVID-19 has only made life worse for Black people in the U.S. Racism in the labor market has forced Black workers onto the most dangerous frontlines of essential work. Yes, Trump is a threat to our safety. But Silicon Valley has done extensive damage as well, using sly legal moves and buying off politicians to steal the benefits workers have earned.

Proposition 22 is only the latest attempt by Silicon Valley bosses to rewrite state laws. It would roll back years of court rulings, agency policy, and statutory law in California, including Assembly Bill 5, which clarified that app-based workers are employees covered by the state’s wage-and-hour laws and eligible for unemployment insurance and workers’ compensation.

Proposition 22 is a step in the wrong direction that harkens back to a long and shameful history of denying Black workers their fundamental rights. The measure sets a dangerous precedent; one that the Trump administration and gig companies could use as fodder for their continued nationwide attack on workers’ rights.

Ms. Murphy was among hundreds of Black Uber and Lyft drivers who penned an open letter calling out gig employers for empty lip-service to the Black Lives Matter movement. The same companies running ad campaigns in support of Black Lives are bankrolling the most expensive ($184 million+) ballot measure in history to take protections away from Black workers.

California voters must vote no on Proposition 22, and say yes to a future with universal rights and good jobs for Black workers and for every worker in the state.

This blog originally appeared at National Employment Law Project on October 23, 2020. Reprinted with permission.

About the Author: Rashad Robinson is an American civil rights leader. He is the president of Color of Change, having joined the organization in May 2011. He has served as a board member of RaceForward, Demos, State Voices, and currently sits on the board of the Hazen Foundation.

Rebecca Dixon is executive director of the National Employment Law Project (NELP).


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Return of the Lockout: Uber and Lyft Try to Strong-Arm California

Posted on by Nelson Lichtenstein
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In August a California court ordered Uber and Lyft to reclassify more than 100,000 drivers as regular employees. The two companies, which depend on a business model that defines drivers as independent contractors, got the decision lifted for at least a few months.

But in the meantime their threat to shut down operations in California—and thereby fire thousands of drivers while ending service to millions of customers—raises the question: What do we call this extraordinary corporate stratagem? A public relations gambit? A pressure tactic? Blackmail? A capital strike?

It’s all of the above, but the best historical analogy is the “lockout,” a disreputable, two-century-old employer weapon designed to force workers to knuckle under.

A WEAPON AGAINST SKILLED WORKERS

The Homestead strike of 1892 began as a stoppage by skilled workers who resisted demands by Andrew Carnegie and Henry Frick to slash wages and union power. Frick erected a fence around the entire mill, locked out all employees, and called in a barge full of Pinkerton private police to protect the scabs he hoped to recruit. When workers routed the Pinkertons in a bloody battle, it took the importation of National Guard troops from Philadelphia to put power back in capitalist hands.

Late 19th century lockouts were not uncommon because the status quo had tilted in favor of elite workers: skilled labor controlled the shop floor in many mills and mines and on construction sites, even as deflation was increasing the value of their nominal wages. Bosses responded with lockouts to force concessions and wage cuts.

Lockouts were far less frequent in the mid-20th century decades of union power and successful collective bargaining. That’s when workers went on strike themselves and almost always came out ahead.

But beginning in the 1980s, when just holding on to the contract provisions won in earlier bargaining rounds was often counted a union success, lockouts returned as an employer weapon. Managers locked out union workers in major battles at Caterpillar, the Detroit newspapers, and A.E. Staley in the 1990s. In more recent years, they used the same tactic at Honeywell and National Grid, a Massachusetts gas distribution utility.

Remarkably, the most high-profile lockouts have arisen in professional sports. Here players established strong unions that captured some of the enormous revenue generated by game broadcast rights. And free agency contracts enabled some stars to win enormous salaries. Owners struck back, precipitating lockouts that wrecked the training season: in 2011, the NFL locked out players for 136 days and the NBA did the same for 161 days. The following year, NHL owners locked out players for 119 days.

GIG WORKERS’ FUTURE AT STAKE

But what does all this have to do with Uber and Lyft? Their drivers are not unionized, after all. True, but they have won, in California courts and legislature, a considerable employment-rights victory that, if and when enforced, will transform the meaning of work in the gig economy, greatly enhancing income and security for many.

Last year California Governor Gavin Newsom signed a law that requires Uber, Lyft, DoorDash, and many other companies to reclassify as regular employees workers currently illegally treated as independent contractors. This means that in the future they will be paid a more predictable wage, earn sick leave and Social Security credits, and find themselves covered by worker compensation and unemployment benefit laws.

And they will be legally entitled to unionize, in which case workers and managers can negotiate a contact that gives drivers as much “flexibility” as Uber and Lyft now claim they want.

So, like the skilled workers of late 19th century America, gig economy drivers and DoorDash “shoppers” now find the status quo theoretically on their side. At least in California, they are on the verge of enjoying work rights that gig employers want to gut. To do so Uber, Lyft and DoorDash have amassed a $181 million war chest to pass Proposition 22 on the November California ballot. That proposition would once again legalize contract work for millions of workers who by any reasonable definition are regular employees.

Uber and Lyft are strong-arming Californians. They hope their threat will convince drivers to abandon their rights and persuade California riders to endorse the theft.

BLUSTER

In 1941 Henry Ford threatened to shut down his company if workers voted for the United Auto Workers. They did and yet Ford continues to this day. Management bluster is often just bluster, which is probably the case with Uber and Lyft.

But in the last month, they have proposed another way to keep employees from their rights: create a set of franchises to employ their drivers, if Proposition 22 passes. Franchising is an old trick, as any employee at McDonald’s, Days Inn, FedEx, or Jiffy Lube can attest. Workers are legally employees in a franchise, but the real employer, the one with the money and power, remains legally aloof. Workers get squeezed and unionization brings few benefits.

So the lockout, once thought a relic of Gilded Age America, has returned with a vengeance, ingenuity, and determination that would have made Henry Frick envious. We need an equally radical rededication to the concept of jobs with rights, and the rewards, monetary and moral, that are their just compensation.

This blog originally appeared at Labor Notes on September 23, 2020. Reprinted with permission.

About the Author: Nelson Lichtenstein is Research Professor in History at the University of California, Santa Barbara.


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AB 5 repeal could land on 2022 ballot

Posted on by Jeremy White
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AB 5 enshrined in law the California Supreme Court’s test for distinguishing employees from independent contractors. 

Voters could get a chance to dissolve California’s controversial worker classification law in 2022.

Assemblyman Kevin Kiley (R-Rocklin), one of the measure’s most ardent opponents in the Legislature, announced he will try to qualify a ballot initiative to repeal the law. It’s too late to run a referendum suspending AB 5, so Kiley would aim to strip its language from statute in the 2022 election.

AB 5 enshrined in law the California Supreme Court’s test for distinguishing employees from independent contractors. While organized labor backers have called that a boon to workers, Kiley has highlighted stories of Californians who have lost work as a result and sought unsuccessfully to repeal it with legislation.

The law is already likely to be on the 2020 ballot, with app-based gig companies like Uber and DoorDash qualifying a measure to keep their workers independent contractors. Kiley said in an interview that his measure would be far broader than one focused on the tech industry.

“The supporters of AB 5 from the beginning have demonized two companies and used that as their main rationale for the law,” Kiley said in reference to Uber and Lyft, but his proposed initiative “is not about one or another company but about the principle of economic freedom and the right to earn a living and the hundreds of professions in California that have been wiped out because of this law.”

A ballot committee Kiley launched last month does not yet have any money in it, and Kiley said he has yet to line up financial backers. He said he hoped his effort would provide an impetus for the Legislature to make a deal — a tactic that has not worked for the tech industry.

This blog originally appeared at Politico on June 2, 2020. Reprinted with permission.

About the Author: Jeremy B. White co-writes the California Playbook and covers politics in the Golden State. He previously covered the California Legislature for the Sacramento Bee, where he reported on campaigns, myriad nationally significant policy clashes and multiple FBI investigations of sitting lawmakers.


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