Article Lead Image

Pixabay (Public Domain)

Uber says new California law won’t make its drivers official employees

The ride-hailing company argues that drivers aren’t a core part of its business.


Mikael Thalen


Uber is pushing back against legislation in California that aims to reclassify the ride-hailing company’s contractors as official employees.

The proposal, known as Assembly Bill 5 (AB5), comes after a recent ruling from the state’s Supreme Court that limits the ability of companies in the gig economy to consider their workers as nothing more than independent contractors.

On Thursday, however, Tony West, Uber’s chief legal official, argued that AB5 does not apply to its drivers.

“Contrary to some of the rhetoric we’ve heard, AB5 does not automatically reclassify any rideshare drivers from independent contractors to employees,” West said during a press call. “AB5 does not provide drivers with benefits. AB5 does not give drivers the right to organize. In fact, the bill currently says nothing about rideshare drivers.”

Whether or not someone is an employee in California is determined by what is known as the “ABC test.” West argued that its drivers would not pass the test because they are not a core part of Uber’s business.

“Under that three-part test, arguably the highest bar is that a company must prove that contractors are doing work ‘outside the usual course’ of its business,” West said. “Several previous rulings have found that drivers’ work is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces.”

The legislation also opens up Uber to lawsuits from the state if it fails to follow AB5’s provisions.

Uber is now planning to push for a 2020 ballot initiative that would create a new job classification for ridesharing drivers, thus removing the possibility that AB5 could transform drivers into official employees.

West also asserted that Uber could increase the wellbeing of its drivers without AB5, which he claims would stifle the work flexibility that their contractors now enjoy.

“Drivers would not be able to choose when to sign on anytime they want it,” West said. “They would work in shifts like every other employee works in shifts. Drivers would not be able to choose to sign off whenever they wanted to because there would be a set time that they would have to work, they would not be able to do that.”

While almost certainly guaranteed, AB5 still must make its way to California Governor Gavin Newsom’s desk before becoming law.


H/T The Verge

The Daily Dot