USA: Uber & Lyft drivers protest in support of bill that classifies workers as 'employees', guaranteeing worker protections and benefits; Incl. Co. comments

In August 2019, hundreds of Uber and Lyft drivers travelled across California by caravan, in support of Assembly Bill 5. The Bill, if passed by the state, means Californian drivers working under these companies will be classified as employees, instead of independent contractors. As an employee, workers would have access to more worker protections and benefits, including paid breaks, overtime, and health insurance.

Uber and Lyft are against this bill, arguing that the classification 'independent contractor' gives drivers the flexibility to work whenever and wherever they want. They are both attempting to secure an alternative deal with labour leaders and lawmakers, which propose new benefits for workers, including a guarantee of $21 an hour including expenses, and a company-funded benefits system.  If a deal is not met, both will work together to implement a ballot measure that would declare workers as non-employees, while implementing the new benefits. 

In October 2019, Uber, Lyft and DoorDash launched  the 'Protect App-based Drivers & Services' campaign, a ballot measure on California's 2020 ballots asking voters to give ride-hailing companies an exemption to AB 5. However, in November 2019, economists found that the campaign introduced by the companies contained loopholes, that could leave some drivers earning as little as $6 an hour, despite a promised 120% increase to $15.60.

Company comments can be found in the articles below.

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Article
12 November 2019

USA: Report finds loopholes in ballot initiative proposed by Lyft & Uber against AB 5 bill

Author: Gabrielle Canon, USA Today

"Uber, Lyft say proposed California ballot measure is a good deal for drivers. Economists disagree", 11 November 2019

...[Uber, Lyft and DoorDash] officially filed the “Protect App-Based Drivers and Services Act”...saying it will help workers maintain independence without forgoing benefits that would be mandatory under AB 5...

...But a new report...concluded that loopholes in the proposal could leave some drivers with less than $6 an hour...

...While the ballot initiative claims Lyft and Uber will guarantee drivers at least 120% of the minimum wage, the analysts concluded that instead of a promised $15.60, the actual wage paid could end up being roughly $5.64 per hour...

...[The analysts] said the guarantee doesn’t apply to the time spent between passengers...so a third of their work hours...wouldn’t count...By their assessment, under-reimbursed deductions for gas, wear and tear, and mileage...[leaves] drivers with only $5.55 per hour.

Recognizing the companies' planned health care subsidy, the academics boosted the total by $1.22, but then took out an additional $1.13 from the total for the amount of payroll taxes the independent contractors would have to cover...and...other benefits required by law for employees. The $5.64 left... comes in at about a third of the required minimum pay for drivers under a new standard already enforced in New York City...

...Uber economist Alison Stein...takes issue with the characterization that drivers aren’t paid for a third of their time...emphasizing that app-users might be idling, running personal errands, or working for another platform during that time...[and argues] that payments made during that time would add requirements and structure that would put limits on drivers’ freedom and flexibility...

...She dismissed the....conclusions that the companies’ proposal underpays on reimbursements, arguing that they actually bumped the rate arrived at by an internal analysis that estimated the average cost of a marginal mile to be $0.258. Instead, they've chosen to offer drivers $0.30....

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Article
30 October 2019

USA: Campaign funded by Uber, Lyft & Doordash launched to ensure exemption from AB-5 through ballot

Author: Alexia Fernandez Campbell, Vox

"Uber and Lyft have launched a campaign to avoid government regulation in California", 29 October 2019

The Protect App-Based Drivers & Services campaign, funded by Uber, Lyft, and DoorDash, will file paperwork...to put a referendum on California’s 2020 ballots. The ballot measure will ask voters to give ride-hailing companies an exemption to AB 5...

...As part of the ballot initiative, ride-hailing companies promise to pay drivers at least 20 percent more than the minimum wage, plus 30 cents per mile to cover wear and tear on their vehicles. The companies would also pay drivers a small stipend to cover health care costs and to provide them with accident insurance. This is better than what drivers get now, but far less than what they would get as employees...

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Article
13 September 2019

USA: Uber to challenge Californian law that could force the company to classify its workers as 'employees'

Author: Tim Bradshaw & Patrick McGee, Financial Times

"Uber vows to challenge new California labour law", 12 September 2019

Uber has pledged to challenge new California rules that threaten to reclassify its drivers as employees, insisting that their work is not a core part of its business as a technology platform...

...Tony West, Uber’s chief legal officer, insisted that AB 5 did not apply to its drivers because it is a technology company, not a transportation provider. “Several previous rulings have found that drivers’ work is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces,” said Mr West...

Legal experts said Uber faced a struggle. "I think they will have difficulty in seeking to oppose this,” said Emilie Cole, a partner at UK law firm Irwin Mitchell. “The fact that they are a technology company is neither here nor there — these drivers are driving passengers around and that is the core function of Uber. They haven’t had much success with that argument in England and Wales.”...

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Article
11 September 2019

USA: California Senate passes bill that could force Uber & others to classify workers as employees instead of independent contractors

Author: Josh Eidelson, Lizette Chapman & Joyce E. Cutler, Bloomberg

"California Senate Passes Bill Set to Transform Gig Economy", 11 September 2019

The California Senate passed a bill that could force Uber and other gig economy giants to reclassify their workers as employees. Such a change would secure labor protections for thousands of people across the state and deal a significant blow to companies that built multi-billion dollar businesses on independent contractors.

Under the new law, Assembly Bill 5, people in California could generally only be considered contractors if the work they’re doing is outside the usual course of a company’s business. Companies like Uber and Lyft which rely on armies of drivers to service their customers, would likely fail that test without transforming how they do business. Employees are entitled to a minimum wage and overtime pay, neither of which is a common protection within the gig economy...

...“...your business cannot game the system by misclassifying its workers,” Assemblywoman Lorena Gonzalez, the Democrat who authored the bill, said in a statement. “As lawmakers, we will not in good conscience allow free-riding businesses to continue to pass their own business costs onto taxpayers and workers. It’s our job to look out for working men and women, not Wall Street and their get-rich-quick IPOs.”...

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Article
2 September 2019

USA: Uber & Lyft's proposed alternative to bill ensuring worker protections criticised for not 'adding up’

Author: Faiz Siddiqui, The Washington Post

"Uber and Lyft are floating a $21 minimum wage. Critics say it’s closer to $15.", 30 August 2019

Uber and Lyft are floating a new proposal to pay drivers a $21 minimum wage. It may not add up. The ride-hailing giants are floating the new wage and benefits as the California State Senate is set to vote on a bill that could convert contracted workers into employees...

...To convince legislators, and drivers, that the move is unnecessary, Uber and Lyft have proposed a $21 hourly “on-trip” minimum wage. Workers also would have access to “portable benefits,” such as sick leave and workers’ compensation. Uber and Lyft have asked drivers to lobby for an alternative.

Those who study ride hailing say the wage proposed by the companies would amount to about $15 at most, because it excludes the time it takes for drivers to return from a drop-off and wait for another trip. Drivers typically spend about 30 to 40 percent of their time without a passenger, and roughly 10 percent is spent driving to pick up a passenger, according to studies. The pick-up period would be compensated...

...Uber argued that data shows its new minimum hourly wage would apply to just below 75 percent of the miles driven by its contractors...

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Article
2 September 2019

USA: Uber, Lyft & DoorDash to put $90 Million towards fighting bill establishing protections for gig economy workers

Author: Josh Eidelson, Bloomberg

"Uber, Lyft, DoorDash Put $90 Million to Possible Ballot War", 29 August 2019

Uber Technologies, Lyft, and DoorDash are putting $90 million behind a ballot measure strategy to ensure they don’t have to reclassify their California workers as employees...

...Firms including Uber and Lyft...have sought for months to secure a deal with labor leaders and lawmakers that would give drivers new perks but avert reclassifying them as employees...

...Uber and Lyft say they remain hopeful a deal can be reached. But as a fallback, each company is placing $30 million into a campaign account for a potential 2020 ballot measure that would declare their workers non-employees while establishing a new set of perks...

...“We remain focused on reaching a deal, and are confident about bringing this issue to the voters if necessary,” Lyft spokesman Adrian Durbin said...DoorDash said...it was committing $30 million...to a separate campaign account...If the companies have to pursue the ballot measure, the perks it provides might not include everything the companies are currently offering in talks, an Uber spokesman said...

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Article
28 August 2019

USA: Uber & Lyft drivers conclude 500-mile caravan demonstration across California advocating bill that ensures worker protections

Author: Dara Kerr, CNET

"Uber, Lyft driver caravan lands in California capital demanding a living wage", 29 August 2019

A caravan of Uber and Lyft drivers concluded their journey...in Sacramento, California, with one message to state lawmakers: pass Assembly Bill 5. The proposed state law could allow for drivers to be classified as employees, rather than independent contractors...

...The caravan...started its 500-mile-long pilgrimage in Los Angeles...before arriving in Sacramento, it stopped in downtown San Francisco...to protest in front of Uber's headquarters...

...Uber and Lyft drivers are classified as independent contractors...which means they don't get benefits including Social Security...Uber and Lyft say...this system gives drivers flexibility. "What we repeatedly hear from drivers is what they value most about Uber is the flexibility...on-demand workers should not have to sacrifice security to enjoy that flexibility."

The Uber spokesman said the company is working...on an alternative model that would give drivers a minimum earnings guarantee, a package of "portable benefits"...and "meaningful representation" that gives drivers more of a say...A Lyft spokesman said Lyft is working on the same alternatives. "Lyft is advocating for an approach in line with the interests of our drivers, by modernizing century-old labor laws that make it difficult to provide both flexibility and benefits,"...

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Article
27 August 2019

USA: Hundreds of Uber & Lyft drivers to caravan across California in support of bill classifying drivers as ‘employees’ instead of 'independent contractors'

Author: Lauren Kaori Gurley, VICE

"Hundreds of Uber Drivers Will Caravan 600 Miles Across California to Demand Better Working Conditions", 22 August 2019

A fleet of more than 200 Lyft and Uber drivers announced today that they will pile into 75 cars and drive roughly 600 miles from Los Angeles to Sacramento next week. The caravan will be advocating for the passage of a bill known as AB5 that would vastly improve their working conditions.

The drivers will make multiple stops for actions around the state, including Uber’s headquarters in San Francisco on Tuesday and the steps of the capitol building in Sacramento on Wednesday...

...The AB5 bill, opposed by both Uber and Lyft, would force the gig economy giants to provide drivers with many basic labor protections that they currently circumvent. It would require them to classify drivers as employees instead of independent contractors...

...Lyft and Uber have sent out in-app notifications to drivers informing them that AB5 legislation could remove “flexibility” from their jobs. What they conveniently leave out is the bill would grant them access to health insurance, overtime pay, sick days, paid breaks, vacation time, worker’s compensation, and disability insurance—all of which they are currently denied.

 

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