Rideshare Drivers Pushing for AB5 to Pass
Hundreds of rideshare drivers from throughout California are converging on the steps of the State Capitol today to advocate for the passage of California State Assembly Bill 5 (AB5). The bill would classify independent contractors as full-time employees.
If the bill passes, hundreds of thousands of California Uber and Lyft drivers will have access to health insurance, sick days, overtime pay, vacation time, paid breaks, disability insurance, and worker’s compensation.
Drivers will also be guaranteed a minimum wage, and get reimbursed for mileage and maintenance on their vehicles.
What is Assembly Bill 5?
Assembly Bill 5 was first introduced by Representative Lorena Gonzalez (D-San Diego) in January 2019. Representative Gonzalez said the bill is a “new and innovative” way to address the inequality in the workplace.
The bill would codify the standard workplace ABC test to determine workers employment status. It expands on last year’s landmark State Supreme Court ruling which fought with a similar employment classification issue.
In Dynamex Operations v. Superior Court, California’s Supreme Court ruled that contract drivers for delivery firm Dynamex were not appropriately classified. The ruling opened the door for rideshare drivers across California to challenge their own statues.
Supporters of AB5
Rideshare drivers are not the only supporters of AB5. Activist and trade groups like Rideshare Drivers United, Gig Workers Rising, Fight for 15, and the Service Employees International Union also support the bill. The groups are standing side by side in support of California Uber and Lyft drivers for higher wages and better living standards.
Watch YouTube Video: Uber Drivers Rally at California State Capitol Ahead of AB5 Hearings. The video below shows what drivers are saying about the issues during a rally at the State Capitol in July 2019.
Opponents of AB5
Although many people support the bill, not everyone is on board. There are oppositions from some rideshare drivers who fear the passage of the bill would take away their ability to work when they want to.
Opponents said the bill doesn’t accurately reflect today’s realities. They are concerned it would move the state backward by eliminating their choice to work independently.
They also argue that many people drive for Uber and Lyft to earn extra money to supplement their day job. If the drivers become full-time employees, they will no longer be able to continue driving part-time. This will leave a considerable gap in the transportation that millions of consumers rely on every day.
The two giant ride-sharing companies, Uber and Lyft, are by far the most vocal opponents of the bill. In recent months, the ridesharing companies have sent out notifications to drivers to inform them that they could lose out on their flexibility of being their own boss.
Watch YouTube Video: Uber/Lyft Drivers Now Employees? California Bill AB5 Would Say Yes. In the following video, a rideshare driver explains why he opposes the legislation.
What Does This Mean for Uber and Lyft?
If the bill passes, it would be a massive blow for Uber and Lyft. According to reports, both companies’ costs could increase significantly. Uber could see a cost increase of $500 million while it could be up to $290 million for Lyft.
Valued at about $100 billion between them, the ridesharing companies argued that having independent contractors become their employees would jeopardize their company’s fiscal health. The companies said they have subsidized the cost of rides for years to increase market share.
Experts are saying consumers will probably need to shell out more money for rides since the costs will eventually need to increase to make profits.
Getting AB5 to Pass
In May 2019, the California Assembly overwhelmingly passed the bill 53 to 11. The bill then worked its way through several state Senate votes. In July 2019, the California Senate Labor and Industrial Relations Committee voted in favor of the measure, 4 to 1.
The bill now heads to the Senate Appropriations Committee. If passed successfully, it will go to a full Senate vote.
If all goes well, the bill will land on Governor Gavin Newsom’s desk for his signature to become law. It will go into effect on January 1, 2020, setting a national precedent for other states throughout the country.
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