Member-only story
Falling Back To Earth
California’s rejection of ride-hailing drivers as contractors undoes the entire gig economy
In California Labor Bill, Near Passage, Is Blow to Uber and Lyft, Kate Conger and Noam Scheiber offer a comprehensive review of the missteps by Uber and Lyft in California leading up to the vote expected this week in favor of Assembly Bill 5, which will require the ride-hailing companies to treat drivers as employees and not as contractors.
The bill is based on a 2018 CA Supreme Court ruling that determines that a worker must be classified as an employee if they perform a function central to a company’s business. So an accountant doing the books can be a contractor, but if your business is providing rides to passengers, the drivers are employees. Period.
The implications go far beyond ride-hailing:
The measure could affect millions of Californians beyond ride-hail drivers, including janitors, nail salon workers and cable-television installers. And it would give momentum to an emerging consensus on the center-left that workers are entitled to a basic level of economic security that many Americans now live without. Several candidates for the Democratic presidential nomination have endorsed the bill, including Bernie Sanders, Elizabeth Warren, Kamala Harris and Pete Buttigieg.
