Uber and Lyft are forced to treat their drivers as “employees”

At a time of massive unemployment, compounded by the global health crisis, progress was made in California for the rights of the self-employed at the end of October. In January, the West Coast state’s AB5 (Assembly Bill 5) law went into effect, although it was ratified in September 2019. It forced the giants of vehicle reservation to re-qualify their drivers independently or “freelance” as employees. With this status and on the basis of the state labor law, workers then had a whole range of rights and benefits: minimum wage, sick leave, unemployment, payment of overtime … The governor of the Democrat of California, Gavin Newsom, declared in late 2019 when he signed it was suggested that this law “would help solve the problem of the status of workers who are considered to be” subcontractors “rather than workers, which prevents them from benefiting from social protection grounds such as minimum wage or health insurance”.

However, Uber and Lyft, the two American leaders of the VTC (Touring Vehicle with Driver), were far from giving in to this legal order. As early as the spring of 2019, their two barely listed securities performed very poorly, while the two giants continued to record sales losses, which were exacerbated by the explosion of covid-19 in the USA. United.

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When California filed lawsuits against Uber and Lyft in May 2020, citing its new law, up to two companies believed the majority of their drivers wanted flexible hours without the restrictions of full time. that addressed them. When the verdict was passed in August and they were asked to comply with the law immediately, the two hailship companies responded by threatening to cease their services throughout the state of California. They had been granted a respite and the appellate court feared protests from the population, which the convenient services of these private drivers arranged quickly and cheaply.

This postponement ended on Thursday, October 22nd. The appellate court has announced its final judgment and does not speak in favor of the company, but of the employees. Attorney General Xavier Becerra said in a statement following the verdict: “Uber and Lyft have used their power and influence to prevent them from treating their drivers as workers who are entitled to these benefits and safeguards (…). It is time for (her) to follow the rules. Both companies have been asked to abide by the AB5 Act once and for all and to ensure the dignity in and through the work their drivers deserve.

In defense, the giants spoke of consequences for the population and appealed to the public interest. Uber and Lyft lawyers predicted fewer trips for consumers, lower incomes for drivers, and an increase in drunk driver accidents when they are forced to classify California drivers as employees instead. Entrepreneur. They say driver reclassification could reduce the availability of app-based driving, which they believe will help reduce drunk driving accidents in California. Mothers against drunk driving submitted an amicus letter in support of Uber and Lyft’s position on the case.

Lawyers also spoke of the economic and social consequences for workers and insisted that they are not “landlords” under labor law, but rather providers of technological platforms (“uberized”) that connect managers with customers. For example, Uber mentioned the possible layoff that will follow as the company can’t hire as many employees as it has independent drivers today. Using unstoppable rhetorical techniques and outright blackmail, Uber spokesman Noah Edwardsen threatened that “the decision (October 22nd) means that unless voters say yes to Proposal 22, riders will be banned from continuing as independent contractors to work, leaving hundreds of thousands of Californians unemployed and likely closing ridesharing in much of the state. “

This Proposal 22, to which he is referring, denotes the voting or referendum initiative designed to allow them to bypass Law AB5 by suggesting alternatives that are a little less interesting to Uber and Lyft. It would guarantee both flexible working hours and certain social benefits for the self-employed. Some concessions would be made: for example, a minimum income guarantee based on “time spent” when a driver fills out a drive or delivery form, but not the time spent waiting for a concert. The benefits are much more limited than required by California law. According to the California Secretary of State’s records, the two VTC giants have invested $ 188 million in the support campaign. Sponsored by gig economy giants Uber, Lyft, DoorDash, Instacart and Postmates owned by Uber, this is the most expensive offering in the state’s history, according to Ballotpedia. a sign that clearly shows the economic importance of the fate of these self-employed.

The latter is one of the major victims of the gig economy, or the task-based economy, indicating an increasingly common trend for companies to hire freelancers or employees on the job instead of real employees. It is one of the atypical forms of work that have emerged from the globalization of the economy and increasing competition: we want to pay workers less and less in order to offer increasingly competitive prices. And very often at the expense of appropriate working conditions and an equally appropriate remuneration.

If Proposition 22 fails, the limo market in California could change dramatically, according to campaign spokesman Yes Geoff Cousin of CNN Business. For better or for worse? It will be discovered. Companies claim that their services are becoming more expensive to consumers and only employ a fraction of drivers on the road today. These employees would have tighter schedules and could no longer simply activate their applications to work when they wanted. On the side of the VTC drivers, who are supported by the unions, it is defended that the compromise of sentence 22 “is an attempt to undermine drivers’ rights to wages and benefits,” argued Mike Roth, campaign spokesman on the other hand.

On the forensic commentator’s side, it is estimated that the job implications could be much wider than those covered in this Uber and Lyft-championed proposal. Veena Dubal, professor of labor law at the University of California at Hastings, said it was “very likely that passing it at all levels would create lower labor standards for the industry.” Delivery and logistics. “

One thing is certain for now: the legal battle between the VTC companies and their drivers is far from over. They were attacked by messages within their platforms’ applications and sued Uber on Thursday October 22nd on the grounds that the “constant flow” of messages persuaded them to vote for Proposition 22 in the workplace, their rights injured have been working. Uber called the lawsuit “absurd” and said it was unfounded. It is, therefore, a fight that begins in the name of the dignity and right to social protection for VTC drivers in California. Business to follow.

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