Rideshare companies Uber, Lyft, DoorDash push back against California law

Rideshare companies Uber, Lyft, and DoorDash are supporting a ballot initiative that would exempt them from a California law that could change how its workers are classified.

The ballot measure, which was announced on Tuesday, Oct. 29, and called the Protect App-Based Drivers & Services Act, would exclude rideshare and delivery network companies from the state legislation, while requiring those same companies to offer new protections and benefits for its delivery drivers.

Last month, California Gov. Gavin Newsom signed into law Assembly Bill 5, which codifies the California Supreme Court’s decision in the controversial Dynamex case.

Dynamex

The Dynamex decision in 2018 established the ABC test, which considers all workers to be employees unless the hiring business demonstrates that all of the factors are established:

A. That the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of the work and in fact.

B. That the worker performs work that is outside the usual course of the hiring entity’s business.

C. That the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

The court’s decision and the new state law could have a major impact on California businesses, including the trucking industry.

Proponents of the law say it will prevent companies from taking advantage of its workers by misclassifying them as independent contractors. Opponents contend that it will prevent workers from maintaining independence.

Ballot measure

Uber, Lyft and DoorDash reportedly are putting $90 million behind the ballot initiative.

“Recent legislation has threatened to take away the flexible work opportunities of hundreds of thousands of Californians, potentially forcing them into set shifts and mandatory hours, taking away their ability to make their own decisions about the jobs they take and the hours they work,” the ballot measure stated.

The ballot measure would guarantee that those drivers make at least 20% more than minimum wage, as well as 30 cents per mile for expenses. Under the initiative, drivers who work at least 15 hours per week would receive a health care stipend.

If the ballot receives the necessary signatures, California voters will likely get to vote on the measure in November 2020.