SAN FRANCISCO—If a law now wending its way through the state legislature passes its final hurdles this summer, hundreds of thousands of California workers now called “independent contractors” will be poised to gain essential benefits like Social Security, unemployment insurance, overtime pay, and workers’ compensation, as well as vital rights like collective bargaining.
Assembly Bill 5, “Worker Status: Employees and Independent Contractors,” introduced by Assemblymember Lorena Gonzalez, D-San Diego, would codify into law a unanimous ruling by the California Supreme Court last year, setting standards to determine whether a worker is an independent contractor or an employee.
AB 5 passed the Assembly by a vote of 53-11 at the end of May and is slated to have its first hearing in the state Senate on July 10.
Last year, in its ruling in Dynamex Operations West, Inc. v. Superior Court of Los Angeles, the state Supreme Court laid out three requirements for employers to prove that workers are really “independent contractors”: 1) they are free from employer control; 2) they work outside the regular scope of the business; and 3) they are independently established in that trade.
This so-called A-B-C test is the heart of Assemblymember Gonzalez’ AB 5.
Workers’ widespread and growing concern over the issue was made graphically clear June 28 as an overflow crowd of workers and their union and community supporters poured into a hearing held by the San Francisco Board of Supervisors’ Committee on Public Safety and Neighborhood Services, determined to have their say on the urgency of passing AB 5.
While emphasis at the hearing was on ride services Uber and Lyft, with dozens of drivers sharing their experiences during public comment, others from the growing gig economy, including many domestic workers, joined in, as did labor leaders and community allies.
As the hearing began, committee chair Supervisor Rafael Mandelman told the packed room that corporations relying on gig workers, including Uber and Lyft, “have achieved recent and rapid success in large part relying on a business model that dismantles more than half a century of advances in worker protections.”
Though the gig economy is often called “the future of work,” Mandelman said, “in many ways, it is a return to our past, bygone days of the pre-New Deal era.”
Rebecca Stack-Martinez, a leader in Gig Workers Rising with experience driving for both Uber and Lyft, told the hearing drivers for the two services now make up about 1 percent of the nation’s workforce. While the two firms say most of their drivers are part-time, she said full-time drivers provide nearly half the rides requested. Nearly two-thirds of those who depend on the two firms for their employment are people of color, she said, while over half have annual incomes of less than $30,000.
Stack-Martinez cited a May 2019 study by the Economic Policy Institute that found Uber drivers earn about $9.21 per hour after the company’s commissions and fees, after vehicle expenses, and deducting the cost of a modest package of health insurance and other benefits equivalent to those of workers classified as employees.
Lyft driver Edan Alva told the crowd that he works long hours for less-than-minimum wage with no overtime or pay for waiting time and is still unable to pay for basic needs like his son’s health insurance and school expenses. “If I work even longer hours,” he said, “I end up with many more care maintenance costs, my health deteriorates, and I put myself and others at greater risk of accidents.
“I feel trapped,” Alva said, “like one of those hamsters running a wheel. I do not ask for handouts. I urge you to enforce existing safety laws with Uber and Lyft, and to support AB 5.”
A woman domestic worker, speaking in Spanish, told the hearing that domestic workers, including babysitters, home care workers, and housecleaners, “are recognized as the original gig workers, because we maintain two to three jobs at a time and many times we work without employment benefits or equal protections.”
She said she is “proud to be supporting other gig workers who are organizing against misclassification,” and called on the Board of Supervisors to support AB 5.
As the hearing adjourned after nearly two and a half hours of testimony, Supervisor Mandelman pledged to bring such a resolution to the whole Board of Supervisors and called on his fellow supervisors not only to support the state legislation but to act locally as well.
The California Labor Federation has backed AB 5 since it was introduced into the Assembly last December. When the Assembly passed the bill on May 29, Labor Federation Executive Secretary-Treasurer Art Pulaski called on state senators “to follow the Assembly’s lead by passing this measure to provide an opportunity for a better life to millions of workers who have been cheated out of basic protections on the job.”
In a June 20 commentary, Communications Director Steve Smith cited Uber and Lyft’s largely unsuccessful attempts to lure and coerce workers into lobbying against the bill. “By codifying gig workers as employees,” he said, “AB 5 would close loopholes that have enabled gig companies to classify low-skill workers as independent contractors in order to set and amend earnings rates through imposition rather than bargaining, not reimburse sick or family time off, and not reimburse operating expenses, among other things.
“This exploitation of labor is wrong, should never have been allowed and should not be allowed going forward.”
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