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She’s a 64-Year-Old Taxi Driver Drowning in Medallion Debt—And She’s Fighting Back

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Dorothy LeConte is part of a movement of taxi drivers demanding that the city of New York relieve their financial anguish.

NEW YORK CITY—Outside the gated entrance to City Hall, a dozen yellow taxi drivers huddle under the canopy of a tent to take shelter from the pelting rain. They sit alongside a line of their sunflower-yellow parked cars, next to a sidewalk makeshift memorial and protest shrine with a backdrop of signs that read: Respect the Drivers, No More Suicides; No More Bankruptcies, Debt Forgiveness Now! The rain has washed away the chalk spelling out the names of the deceased drivers etched against the cold pavement. The wicks on nine tall red candles are wet. On the previous rainless nights they burned bright, illuminating like a soundless incantation the names of nine taxi drivers who have committed suicide: Danilo Corporan Castillo, Alfredo Perez, Douglas Schifter, Nicanor Ochisor, Yu Mein Kenny Chow, Abdul Saleh, Fausto Luna, Roy Kim, and Driver Brother (unnamed to honor the wishes of the family that survived him). They were lost to the anguish of crushing debts and dissipated earnings.

Dorothy LeConte, 64, wasn’t there that October 4 night, but she feels the anguish of owing a medallion debt of $558,000 with monthly payments of $2,000. “Sometimes, I think about suicide,” she tells me one sunny Saturday afternoon as we sat in foldable chairs beside the protest shrine. “And then, when I come back, I think about my children, and I turn around and say, ‘Dorothy, don’t.’” She reaches for extreme examples of horrible incidents a person can endure to convey the deflated morale of drivers. “This is worse than if a man left me pregnant in the street
 What the city did to us, and they don’t care.”

LeConte’s predicament is far from unique among thousands of driver-owners of yellow taxis who the city has left in a lurch as they scramble to piece together enough earnings to payoff insurmountable debts.

Yellow taxi driver-owners and their union, the New York Taxi Workers Alliance (NYTWA), representing approximately 21,000 for-hire and yellow cab drivers, have set up a 24/7 protest encampment. They are eyeing October 31, the deadline for when Mayor Bill de Blasio and City Council must sign off on a budget modification, providing an opening for drivers to attain debt relief on their terms, not those of the banks. (Disclosure: This author worked for Mayor Bill de Blasio’s Democracy NYC Initiative as a communications director from December 2020 to January 2021.) Survey estimates put the median yellow taxi driver-owner debts at $500,000, according to a January 2020 report published by the Taxi Medallion Task Force.

Individual driver-owners account for about 40 percent of the city’s 13,587 yellow cabs. These workers, mainly from countries like Bangladesh, Pakistan, Haiti and Ghana, purchased medallions from the city in order to operate a taxicab and pick up street hails in parts of Manhattan. The medallion originated in 1937 as a means to control the number of cabs on city streets. For nearly a century, their values were modest, but then a speculative bubble spiked their values to stratospheric heights, reaching above a vertiginous $1 million per medallion in 2014, plummeting to $100,000 in 2019 after the bubble burst, and hovering at approximately $100,000 today. Banks and the city pushed exploitative loan terms with inflated prices to immigrant drivers even as they knew the value of medallions was on a downward spiral.

After years of protest against predatory lenders who, abetted by city agencies, saddled immigrant driver-owners with insurmountable debts, Mayor de Blasio pledged in March to allocate $65 million. Under the mayor’s plan, lenders receive a $20,000 grant to go towards a down payment to restructure the debts of driver-owners. It also includes $9,000 for yellow taxi drivers to use for monthly debt payments. With the pressure mounting on Mayor Bill de Blasio, the union held a press conference on October 13 to announce the support of over 50 elected officials backing its debt relief proposal. Then, on Friday of that week, dozens of yellow taxi drivers snarled traffic on the Brooklyn Bridge in protest, demanding debt forgiveness. On Monday, the union announced plans to begin a hunger strike.

“First of all, the $65 million, just the $20,000 grant won’t even cover that many people,” according to Bhairavi Desai, Executive Director of the NYTWA. Desai estimates there are between four to six thousand driver-owners who drive for a living and those who may be retired. 

“If you go back to the record six months ago, they basically said everyone’s going to get $20,000 as a cash down payment to restructure the debt and then $9,000 to help you pay for your mortgage for up to six months,” she adds. “But now that the rules are out, the rules make it impossible for anybody to access that $9,000 because there’s a hardship requirement. If you’re out driving, you’re not going to be considered in hardship, no matter how much you’re struggling.”

The NYTWA has vetted a different proposal with the city’s comptroller’s office that is backed by New York City’s entire Congressional delegation in addition to state and local elected officials, as well as academic experts on banking and finance. That counter proposal calls for a debt restructuring plan of $90 million over 30 years, with the city providing a guarantee in the case of default and setting a limit of medallion debt loads to $145,000 with monthly payments capped at $800. Chief benefits of the NYTWA proposal would include more driver-owners and lower monthly payments to a manageable amount. The program, unlike the city’s proposal, would include driver-owners who are in foreclosure or undergoing bankruptcy proceedings, allowing drivers to negotiate favorable terms with lenders because the city would guarantee the restructured loans.

The city says that more than 1,000 people have signed up for its proposal. “It literally just means that people are calling them up to make an appointment,” says Desai. Asked to clarify what signing up for city’s proposal means, a spokesperson for the city Taxi and Limousine Commission (TLC) responded that “1,000 medallion owners have applied to the program.” The spokesperson also said the city is working with a “dozen lenders.” According to the city, 102 drivers have received concrete debt relief.

New York Legal Assistance Group attorney Randal Wilhite characterized as “patently false” the city’s claims of how many people have signed up for the debt relief program. (For speaking out, Wilhite was suspended from NYLAG and prevented from testifying at a TLC hearing.)

One person who won’t be taking the city’s offer as it stands is Dorothy LeConte. When she started driving a yellow taxi in 1987, she wasn’t venturing entirely into the unknown. Word on the street was upbeat about the financial possibilities owning a medallion conferred on women specifically, and immigrants more generally. The evidence of financial independence was self-evident. In those days, LeConte could walk up to a driver who’d happily report on favorable remuneration and confirm a medallion was truly all that it was cracked up to be, a lifelong investment with good returns. So, she did just that, striking up a conversation with a woman sitting in her cab in the shade on Lexington Avenue. 

Her years working housing keeping at the Waldorf Astoria ended with the promise of one day being the driver-owner of a medallion. At first, she leased a car. Then, LeConte, originally from the island nation of Haiti, drew on the time-honored tradition of mutual aid among the Black diaspora, called sou-sou, or an informal savings club, to pool together a pot of cash to purchase a medallion. People in a sou-sou contribute money to a collective fund that pays out a lump sum each month to a participant based on their number in a monthlong cycle, which can average from 18 months or less based on the payout amount for each member. In 1989, she took the $17,000 payout to put down as a deposit on a medallion costing $140,000.

A single mom raising two Black boys, LeConte saw the taxi industry and her possession of a medallion as a reliable way to earn enough money to keep her children off the streets and in school.

“I’m raising two Black kids,” she says. “I’m out from four o’clock in the morning, and I’m coming home the next morning at three o’clock. I don’t want my sons to be in the street. I decided to put them in a boarding school. This is the American dream.”

But it was more than a mere pursuit of an elusive American dream. She paid $43,000 a year to a boarding school in Pennsylvania for the assurance that it would provide safety.

“My 14 year old didn’t have to hang out in the street and get killed by the police, or by the gang, or involved in drugs, saving the Rikers Island money,” she adds. “That’s what I use my money for.”

To provide for her children, she put in grueling hours, pushing her body to the limit. The pain of sitting in a cab with no end in sight hobbles the body and curves the bones, but the spirit is more dogged.

The early signs of the taxi crisis began during former Mayor Rudy Giuliani’s tenure at City Hall. Giuliani bragged about breaking the 1998 strike among drivers organized by the NYTWA and violated their constitutional rights. When LeConte got her first taxicab, she paid $9,000. Under Giuliani, yellow cabs had to change every five years as part of his efforts to give a Hollywood facelift to New York City and increase regulations on immigrant drivers.

To drive a cab today, “you need $45,000 to $50,000. [If] you don’t have the money, you got to [borrow] against the medallion,” says LeConte. That’s excluding medallion loan debt payments. To become a driver-owner was increasingly cost prohibitive. Last year, 4,500 taxis needed to be replaced after seven years on the road at a cost of $135 million, according to Crain’s New York.

Despite these financial hardships, yellow cab drivers continued to motor down New York City streets, taking pride in serving the public. LeConte runs through the times she’s come to the aid of the city’s residents and visitors, from September 11 to the 2003 blackout. “When I say we build the city, we do.”

She says yellow taxis are peripatetic ambassadors to countless tourists on their first visits to New York.

“People come for the first time to New York. They’re so happy to grab a camera,” she says, and take a photo of a yellow taxi. “I am in the movies.”

“I’m always there. In everything, I help the city.”

According to LeConte, this includes intervention in harrowing domestic violence incidents.

“Another time, another woman, a man was beating her up. I was right in the middle of the street. I just rolled down the window. I said, ‘Jump in.’ She jumped in the cab, locked the door, and I flew with her.”

LeConte weathered ups and downs in the industry, but she said nothing prepared her for the arrival of Uber and Lyft, inundating New York City streets. Her brother, with a job in the technology sector, saw the writing on the wall and warned her in 2015. But she refused to heed his warnings.

“This is a New York City franchise. New York City will never allow this medallion to go all the way down,” she reasoned with her brother.

City data showed a 10 percent drop in revenue per yellow cab after Uber’s debut in 2011, with yellow taxi ridership in shambles. Medallion values held steady for a few more years, but the industry was soon ravaged by the combined forces of the city allowing banks and hedge funds to aggressively push predatory loans. Banks targeted people who they knew couldn’t service the loans, according to a New York Times investigation. They took advantage of immigrants whose first language wasn’t English to sign turgid contract terms they could, at best, only puzzle through. And even as the city knew there was trouble in the medallion market, it continued to inflate the value. Experts deemed the speculative bubble the largest since the housing crash of 2007.

“I don’t think I could concoct a more predatory scheme if I tried,” Roger Bertling, the senior instructor at Harvard Law School’s clinic on predatory lending and consumer protection, told The New York Times. “This was modern-day indentured servitude.”

Drive-owners of yellow taxis are now trapped in Sisyphean ordeal, pushing a proverbial boulder up a mountaintop only to see it come crashing down, seemingly until the end of time, as many drivers like LeConte are in their 60s.

“We estimate between 4,000 to 6,000 thousand have underwater loans,” says Desai from the NYTWA.

LeConte describes going to her mailbox during the pre-Uber years of the early 2000s and finding five flyers promoting loans or refinance offers. “You open the taxi news, and you find people advertising” to borrow against the equity in the medallion, she explains. “Some people borrowed against it.”

“I did not expect what happened here to me today, and to us. The city will be responsible, because I know a government is there to protect the people,” she says. “I don’t think the government is there to sell us out.”

Without the city’s protection, the banks and tech companies have had free rein to extract the last cent from workers. Because the medallion after 2015 can no longer serve as collateral, she says, “you will be the collateral. If they can’t find anything on you, they’ll probably take you to a barber shop, they’ll shave your hair. If you have long hair, they’ll sell your hair for fake hair in the street. Whatever you have, they’ll take it away from you.”

She draws parallels to the financial ruin facing yellow taxi drivers today to the 1921 Tulsa Race Massacre. In May 1921, a white mob went on a rampage in the economically thriving, predominantly Black Greenwood neighborhood of Tulsa, Oklahoma. The mob was incited by a false story of a Black man assaulting a white girl, fueling the already potent adrenaline of white supremacy through the veins of an armed white mob of looters and arsonists. All told, hundreds of African Americans residents were savagely killed, their 1,250 homes and assortment of businesses annihilated by racial terrorism. According to a 2001 state commission report, property loss claims reached about $27 million in today’s dollars.

“You remember that story?” she asks me. ”The government burned its Black people down, taking their wealth, killing them. They lost everything.”

“The whole world is looking, but they [are] using the technology,” she adds, referencing the city allowing Uber to break the law and flood New York’s streets with app-based drivers.

The feminist intellectual Jacqueline Rose has attributed the unseen violence of capitalism, or what Rosa Luxemburg once called the “quiet conditions,” to the “skill with which capital cloaks its crimes.”

The fire of righteous indignation that blazes from within LeConte refuses to be tamped down, but she has also reconciled herself to the realities of age and the unseen casualties of the spirit.

“I need the day off. I need to stay home. I’m 64-years-old. When I go to my doctor, I have pains in my fingers, sprain in my knee. I can’t get up, pain in my back.”

The toll of driving a cab all these years has finally begun to manifest in her body. But it’s also overtaken her mind.

The anguish of the banks coming for her to collect $558,000 has deprived her of the balm of a good night’s sleep. “I never get a good six hours, eight hours of sleep. Never. Because I’m dreaming. What is going to happen to me? What happens with my dignity?”

About her plight, she says, “it’s not because I’m sick. It’s not because of an accident that I’m paralyzed. [It’s] because of the government that I trust. We ask Mayor de Blasio only to guarantee the loan.”

About the Author: Luis Feliz Leon is a freelance journalist from New York City and an educator at Labor Notes.

This blog originally appeared at In These Times on October 19, 2021. Reprinted with permission.


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

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

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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

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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

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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 RaceForwardDemosState 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

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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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Why Many Uber Drivers Couldn’t Afford To Stay Home During Australia’s Fires

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Australia’s bushfire crisis has killed tens and incinerated an area two-thirds the size of Illinois. The resulting blanket of smog reduced air quality in the nation’s capital, Canberra, to third worst among all major cities. But the latest manifestation of the climate crisis has hurt an already hard-done by group: gig workers delivering food for Uber Eats. While state governments have advised people to stay home, for gig workers relying on Uber to survive that’s tantamount to asking them to starve, miss rent, or fall behind on loans. All Uber has done, according to these workers, is warn them that going outside hurts their health. Concerning itself as little as possible with its employees’ well-being is a central part of Uber’s business model, defining its workers as independent contractors so it can skimp on providing health care, benefits, or a minimum wage.

But viciously exploiting its drivers—or changing the ‘norms’ that led to a “culture of sexual harrasment” at the company—didn’t stop Uber from losing $1.2 billion between July and September of last year. Their balance sheet from the three months prior to that had them $5.2 billion in the red. Despite never fulfilling the capitalist imperative to turn a profit, ridesharing services like Uber have managed to remake urban life, destroying the licensed taxi industry at a substantial human cost and worsening traffic in major American cities. As the numbers show, the daily reality of Uber drivers is no more rational or fair than one would expect from a company that loses billions while awarding its CEO a $3 million salary.

  • 3,900,000 – Uber drivers worldwide in 2019
  • 36% – U.S. adults who say they used a ride-hailing service in 2018
  • 30% – Uber’s cut of each driver’s fares as of 2019
  • $9.73 – Estimated hourly net income (including tips) of Uber drivers in 2018, factoring in vehicle expenses and Uber’s cut
  • 13 – Major U.S. markets where Uber drivers’ hourly compensation (before taxes) was below the mandated minimum wage in 2018, including the three largest: Chicago, Los Angeles and New York
  • $20,000 – Estimated annual salary, after expenses but before taxes, for an Uber driver working 40 hours per week in 2018
  • $20 million – Amount the Federal Trade Commission fined Uber for falsely claiming its NYC drivers could make $90,000/year in 2017; the company couldn’t produce a single driver who made that much
  • $143 million – Total compensation for Uber’s top five executives in 2018
  • $90 million – Amount pledged by Uber, Lyft and DoorDash to fight a 2019 California law that would classify rideshare workers as employees rather than contractors
  • 0 – Latinx or Black employees who held Uber tech leadership roles in 2018

This article was originally published at In These Times on January 30, 2020 by the editors of In These Times. Reprinted with permission.


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New Jersey hits Uber with $650 million bill for back taxes, this week in the war on workers

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New Jersey says Uber owes $650 million in back taxes and interest for misclassifying workers as independent contractors. This isn’t coming out of nowhere—in 2015, the state notified Uber it owed $54 million in unemployment and disability taxes. Four years later, the number has grown to $523 million in past-due taxes and $119 million in interest and penalties.

No surprise, Uber says it will fight to avoid paying its tab. And the decision that Uber drivers are employees could have major ramifications beyond taxes—refusing to treat its workers as employees is at the heart of Uber’s business model. New Jersey is dealing other blows against that misclassification, including determining former rideshare drivers to have been employees for the purposes of collecting unemployment (one of the taxes Uber hasn’t been paying), and the state Senate is considering legislation cracking down on misclassification. California recently passed such a law, which Uber and other affected companies have said they will spend tens of millions of dollars fighting. A class-action lawsuit against Uber in New Jersey also seeks to escape Uber’s forced arbitration requirement because the drivers in question are involved in interstate commerce.

Uber’s business model is reliant on violating labor law to exploit workers, and, as the New Jersey case shows, it also cheats states of massive amounts of revenue. Increasingly, that model is under challenge in the states. Following the New Jersey demand for back taxes, the New York Taxi Workers Alliance’s Bhairavi Desai said in a statement, “New Jersey is sending a message that the state’s labor laws aren’t dictated by corporations. It’s time for New York to follow.” It is time, and that would be another major challenge for Uber. At some point, you have to wonder how many big states even a rich company like Uber can afford to keep battling for the right to violate labor laws.

This article was originally published at Daily Kos on November 16, 2019. Reprinted with permission.

About the Author: Laura Clawson is a Daily Kos contributor at Daily Kos editor since December 2006. Full-time staff since 2011, currently assistant managing editor

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Uber CEO Forgives Saudi Arabia for a Brutal Murder, But Punishes Drivers for Small Errors

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Image result for Audrey Winn"In an Axios interview that aired on HBO last Sunday, Uber CEO Dara Khosrowshahi made a troubling analogy. Discussing Uber’s ties to Saudi Arabia—whose sovereign fund is one of Uber’s largest shareholders—Khosrowshahi described the assassination of Washington Post columnist Jamal Khashoggi as a “mistake” comparable to the company’s own “mistakes” in reckless automation. This “mistake” was brushed off casually, with no mention of its place in the context of other Saudi “mistakes,” including an ongoing violent war against Yemen and a long history of brutally silencing domestic critics.

“It’s a serious mistake,” Khosrowshahi said, referring to the order from Saudi crown prince Mohammed bin Salman’s to kill and dismember Khashoggi at the Saudi consulate in Istanbul in October of 2018. “We’ve made mistakes too, right, with self-driving, and we stopped driving and we’re recovering from that mistake. I think that people make mistakes, it doesn’t mean that they can never be forgiven.”

The self-driving “mistake” Khosrowshahi alluded to was the death of pedestrian Elaine Herzberg, who was killed by an Uber self-driving car in 2018. According to documents released by the U.S. National Transportation Safety Board (NTSB) last week, there was “a cascade of poor design decisions that led to the car being unable to properly process and respond to Herzberg’s presence as she crossed the roadway with her bicycle.” She was thrown 75 feet in the air by the collision and died on site.

Though Khosrowshahi scrambled to backtrack his statement, his apology seems disingenuous given his previous record of emphasizing the importance of forgiving corporate wrongdoings. In a 2018 interview, Khosrowshahi defended Uber COO Barney Harford, who left the company after allegations of making racial slurs and sexist comments.

“I don’t think that a comment that might have been taken as insensitive and happened to report by large news organizations should mark a person,” Khosrowshahi said. “I don’t think that’s fair. And I’m sure I’ve said things that have been insensitive and you take that as a learning moment. And the question is, does a person want to change, does a person want to improve?”

This attitude reveals a larger issue at Uber—the jarring double standard for forgiving corporate “mistakes” while punishing driver errors, even though corporate leaders have far more power to perpetrate large-scale harm.

Since its inception, Uber has faced a steady stream of public controversies. In 2014, former Uber CEO Travis Kalanick joked that the company’s nickname was “Boober” because of the way it boosted employees’ sex appeal. That same year, it was also revealed that Uber’s self-named “God View” could be used to track riders’ locations, including the locations of journalists the company sought to intimidate. From spying on Beyoncé and competitors, to systemically underpaying drivers, to firing over 20 employees who filed sexual harassment claims, the company is quick to seek leniency for itself and drop its “mistakes happen” attitude the moment it turns its attention toward drivers.

In contrast to its internal corporate policies, Uber’s attitude toward drivers is unforgiving. Uber has a militantly single-minded emphasis on high ratings. Given this mindset, it is not surprising that Uber drivers are at risk of getting fired if they maintain a rating below 4.6. This policy remains unchanged, despite the fact that studies have shown that Uber’s rating system allows riders to express biases and evaluate drivers in ways that violate federal anti-discrimination laws.

When drivers are deactivated for low ratings they are told they can rejoin the platform if they complete costly, time-consuming training courses run by Uber’s third-party partners. Many can’t afford these classes already, due to Uber’s dropping wages and vanishing bonuses. Instead of getting training course discounts from the tech giant, however, this requirement remains.

The lack of sympathy is unsurprising given Uber’s history of holding drivers’ poverty against them. Who can forget the now-viral six-minute exchange, where former-CEO Travis Kalanick responded to a driver’s complaints about plummeting rates by telling him that he wasn’t a hard worker—that “some people don’t like to take responsibility for their own shit. They blame everything in their life on somebody else.”

Even when drivers have “worked hard” and excelled in their ratings, however, Uber still has ways to punish them. Any number of offenses can lead to deactivation, including, according to Uber, “certain actions [drivers] may take outside of the app, if we determine that those actions threaten the safety of the Uber community, or cause harm to Uber’s brand, reputation, or business.” Though some attempt has been made to clarify these guidelines, confusion remains. Drivers have been allegedly deactivated for a punishing range of issues, including allegedly reporting when passengers called them anti-Muslim slurs and making private Facebook posts.

Uber has a new CEO, but it’s still business as usual. The company’s continued operation is premised on forgiveness for the rich and powerful, and punishment for workers. Khosrowshahi’s statement shows this injustice remains, without any evidence of corporate self-reflection.

This article was originally published at InTheseTimes on November 13, 2019. Reprinted with permission.

About the Author: Audrey Winn is a Skadden Fellowship Attorney working and writing in New York City. She is passionate about workers’ rights, algorithmic transparency, and the inclusion of gig workers in the future of the labor movement.

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Hey, Uber and Lyft: Gig Work Is Work. California Just Said So.

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The rideshare industry seems to have been on an unstoppable tear, running roughshod over regulations, filling the streets with cars, and making astronomical sums of Wall Street capital. But California just tripped up Uber and Lyft’s business model with pioneering legislation to rein in the freewheeling “gig economy.”

The law, Assembly Bill 5 (AB5), passed overwhelmingly in the California Senate this week and is expected to be signed by Governor Gavin Newsom soon. It lays out a clear standard, the so-called “ABC test,” to ensure employers are properly categorizing workers as independent contractors, taking into account how much control the company exerts over their working conditions. Under the law, an independent contractor is defined as a worker with real autonomy: a person who (a) is not directly controlled by the company, (b) does work in the same trade or field independent of that company, and (c) is “independently established” as a proprietor of a separate business in the same sector. Under AB5, if you’re a rideshare driver whose entire livelihood depends on the rides your app funnels into our smartphone every hour, you’re likely an employee under California law.

The ABC test will codify the decision made in a landmark California Supreme Court case last year, Dynamex Operations West, Inc. v. Superior Court of Los Angeles. The Court ruled in favor of delivery service workers who argued they deserved to be classified as employees because they were forced to wear the company’s uniform and display its logo despite being legally deemed “independent.” A major goal of the AB5 legislation is to stop employers’ widespread abusive misclassification of workers as independent contractors, in order to deny them regular employment rights and protections, often by insisting that their workers are merely app users.

Once classified as employees under state law, gig workers—not just platform-based workers, but also nail technicians, home-repair workers and dog walkers—would have access to California’s minimum wage, overtime pay, paid rest break, parental leave and workers’ compensation.

Yet Uber and Lyft both continue to resist AB5, and Uber has even indicated that it does not plan to follow the law once it goes into effect at the start of 2020. The company argues that neither the companies, nor many of their drivers, want to be bound by state labor laws and prefer to drive Uber as a casual side hustle.

But thousands of drivers are already organizing in California for more power over their working conditions. According to Brian Dolber, an organizer with the California-based Rideshare Drivers United, a fledgling union of 5,000 drivers, AB5 paves the way to formal unionization. But Rideshare Drivers United has not yet decided on what form the union will take. For now, he said, “We’re really putting drivers’ voices first.” Dolber added, “We want to continue organizing drivers and have drivers decide how they want their union to be structured.’

Critics of AB5 point to the potential loss of “flexibility” once gig workers are regarded as  employees. However, labor advocates dismiss the flexibility question as concern trolling by the bill’s corporate foes. Nayantara Mehta of the National Employment Law Project argues that current labor laws do not automatically exclude jobs with irregular hours, such as union nurses and construction workers, from being employees. Besides, AB5 deals with the degree of control a company exerts over a worker, not how the schedule is set. “Courts have found that just because a worker has a flexible schedule doesn’t mean she is somehow transformed into the operator of her own business—the true benchmark of independent contractor status,” writes Mehta.

Moreover, the fixation on flexibility elides the reality of many gig jobs. Workers’ schedules may be unstable, but not by choice: Often workers are glued to their phones so they can scramble for whatever rides pop up on their phone, or get paid for each manicure they do or each burger they deliver. Their pay could be so dismal that workers “flex” themselves into exhaustion.

“We drive and we drive and we drive,” said Nicole Moore of Rideshare Drivers United, who helped coordinate a rideshare strike in May. “We don’t have dinner with our kids, we don’t do all the things that we’re supposed to be doing in life. Yet we’re expected to pay the rent, we’re expected to put food on the table, and try to make a better life for our kids.”

This is not the first time Uber’s independent contractor system has been challenged. Various lawsuits in recent months have sought to establish workers’ formal employment rights, with mixed results. Uber managed to wriggle out of two lawsuits in March, which together settled for $20 million with 13,600 drivers—but did not address their status as non-employees. Meanwhile, growing efforts to organize rideshare drivers, particularly the New York Taxi Workers Alliance, have helped win increased labor protections at the state and local level, including a minimum wage for drivers in New York City.

Facing the prospect of their payrolls becoming saddled with thousands of brand new workers, gig-company executives are panicking. Uber and Lyft spent a total of about $750,000 lobbying the California legislature, alongside other professional and industry associations that sought exemptions from the law. In the end, Uber and Lyft were not granted the carve-out they were hoping for in the bill, but other trades—including real estate and insurance agents, doctors, engineers, architects and lawyers—were exempted.

Now Uber, Lyft and DoorDash are reportedly joining forces to fight AB5 using a time-honored California political strategy: investing $90 million on a ballot initiative asking voters to overturn the law and erect a different legal regime for gig workers, which might include some weaker benefits and pay standards.

So the gig economy’s leading lights are bent on fighting the law until the bitter end. But in this next round of legal battles, California’s new law, which is based on a Supreme Court ruling and reflects growing public disillusionment with the gig economy titans, might finally put the brakes on the platform economy’s regulatory rollbacks.

Moore is hopeful that the law can help narrow the gulf between Uber executives and drivers. “There’s no difference between my humanity and their humanity, sha says, adding: “The basic American agreement is that yes, be innovative, become a millionaire, build your own business, but the American compromise is that you will need to share some of those millions with the people who do the work in your company, so that they can also afford to take a Lyft.”

This article was originally published at In These Times on September 13, 2019. Reprinted with permission.

About the Author: Michelle Chen is a contributing writer at In These Times and The Nation, a contributing editor at Dissent and a co-producer of the “Belabored” podcast. She studies history at the CUNY Graduate Center. She tweets at @meeshellchen.


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Find an Employment Attorney

The Workplace Fairness Attorney Directory features lawyers from across the United States who primarily represent workers in employment cases. Please note that Workplace Fairness does not operate a lawyer referral service and does not provide legal advice, and that Workplace Fairness is not responsible for any advice that you receive from anyone, attorney or non-attorney, you may contact from this site.