This story was originally published by Capitol Weekly.
A rideshare driver since 2016, Nick Cabalar of Stockton said his work experience changed dramatically after voters approved Proposition 22 in 2020.
That ballot measure, supported by the gig-economy companies Uber, Lyft, DoorDash, Instacart and Postmates, sought not only to define app-based drivers as independent contractors under state law, but also prevent them from forming unions.
After it passed, Cabalar said he had to increase the amount of time he worked from six to eight hours four days a week to at least 10 hours six days a week to make the same amount of money.
The change, he said, speaks to the greed of companies like Uber and Lyft, who Cabalar says have forgotten that drivers “are the foundation” of their operations. That’s why he’s grateful for Assembly Bill 1340 by Assemblywoman Buffy Wicks, D-Oakland, which grants rideshare drivers the ability to form unions in California.
“We just want to be treated as humans,” Cabalar said.
AB 1340 represents roughly a decade or more of work by labor in the state. Ever since Uber launched in 2009, there’s been an ongoing, global debate about whether rideshare drivers are indeed independent contractors, as claimed by the apps, or bona fide employees, as claimed by workers and labor advocates.
But labor’s perspective didn’t really get a toe hold, at least in California, until 2018, when the California Supreme Court issued its landmark decision on the Dynamex Operations West Inc. v. Superior Court of Los Angeles case.
Dynamex is a same-day courier service that previously classified its California drivers as employees, but converted them all to independent contractors in 2004, as a cost-saving measure. A driver subsequently filed a class-action lawsuit, alleging that the company misclassified its workers in violation of the law.
In court, Dynamex argued that their drivers qualified as independent contractors under the Borello test, which was established in a state Supreme Court ruling in 1989. A critical factor in determining whether a worker is an employee or independent contractor under that legal test is assessing whether the worker has control over the manner of doing a task, but control or supervision isn’t necessary.
In their ruling on the Dynamex matter, however, the California Supreme Court justices rejected the Borello test for the ABC test, which assumes all workers are employees unless they are free from control from a hiring entity in terms of rating their performance, do their work outside of the normal course of the hiring entity’s business and is engaged in an independently established trade that’s the same in nature as the work performed for the hiring entity.
Under the ABC test, Dynamex drivers qualified as employees, not independent contractors. The decision in the Dynamex test was immediately codified by the Legislature in 2019 under AB 5 by then Assemblywoman Lorena Gonzalez, who today is the president of the California Labor Federation.
The following year, the gig-economy companies poured millions of dollars into Prop. 22. After voters approved it, labor began trying to chip away at it in court, eventually securing a victory in the Castellanos v. State of California case that said the ballot measure couldn’t prevent future legislation to allow rideshare drivers to unionize.
As with AB 5 and the Dynamex decision, AB 1340 seeks to build upon the Castellanos decision. The bill passed out of the Assembly in early June, the Senate Committee on Labor, Public Employment and Retirement later that month.
The bill “has the potential to empower hundreds of thousands of workers, giving more Californians the right to organize than any other legislation in recent state history,” Wicks said at the Senate committee hearing.
Unsurprisingly, AB 1340 is opposed by Uber and Lyft as well as the California Chamber of Commerce. A core argument against the bill is that it contradicts the wishes of the voters who supported Proposition 22.
“Voters approved Prop. 22 and the courts upheld the law, yet special interest groups are repeatedly trying to undermine our rights as drivers, said Al Porche, a San Diego rideshare driver who was quoted in a Protect App-Based Drivers & Services Coalition news release sent out after the Senate committee approved the bill. Protect App-Based Drivers was the “Yes on Prop. 22” coalition.
“This bill is bad for drivers, bad for consumers and will threaten the personal information and privacy of millions of rideshare drivers like me,” Porche said. “The Legislature should reject this policy.”
Said an Uber spokesperson to Capitol Weekly in an email: “Californians are already feeling the squeeze – and this proposal would drive up rideshare costs even more while threatening the flexible jobs thousands depend on. Drivers have been clear: they want to stay independent and keep the freedom to choose when and how they work, with access to meaningful benefits.”
The only legislators voting against AB 1340 when it passed out the Assembly on a 54-15 vote were Republicans, suggesting the bill is on a cruise course to the governor’s desk. Gov. Gavin Newsom, however, is known to have a soft spot for tech companies, who in this case have shown a willingness to spend on the issue.
That could mean the fight won’t end in the Legislature – or even any time soon.
Capitol Weekly covers California government and politics in order to enlighten and educate Californians about public policy and state governance, and to provide a platform for engagement with public officials, advocates and political interests.
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