Update on AB5
uber.com
uber.com
In many ways, I can see it. I think the issue lies in a lot of Uber's current policies around drivers e.g. very strict rules around cancellations. If Uber was just a lead generation provider then it shouldn't care or intervene if a driver decides they don't want a job, but depending on the scenario you can be punished if you don't want to take a job.
Part of me thinks Uber could get away with this if they just relaxed some of their current driver policies (e.g. more limited penalties for cancellations). The issue is whether doing so would drastically deteriorate the quality of the service for riders.
[1] Edit: To clarify, I mean "the model they're promoting of what their core business is", i.e. the claim that "they're a lead-gen platform they license out"; I'm not saying they're business model is financially non-viable.
Most of us don’t have such great experiences with taxis as you do. “Legally bound” still leaves a lot of wiggle room for really crappy experiences.
What kind of negative experiences did you have with taxis that you didn’t get with the ride hailing apps?
Honestly, just keep the 'we don't show drivers with a less than X star rating' in place, and allow the rider to give the driver a low rating for cancelling. Self correcting problem - drivers that routinely cancel will be pushed out, and the (potential) one bad rating shouldn't hurt routinely good drivers.
They don't just take a commission, they set the entire price.
They set the rules, about the types of vehicles, about cleanliness, about myriad other things. The route. "Lead generation" is obtuse.
I'm going to go with yes. The only times I use ride sharing services (Lyft, not Uber) are in high-density situations like getting to and from the airport. Depending on the hour there will be dozens to hundreds of drivers hovering in the area trying to get rides. As soon as "rider available" appears on screen a dozen different drivers are mashing the accept button.
Up until a year or two ago, the drivers would then see where I want to go and then call me on the phone to say they didn't want to go there, telling me to cancel the ride they had accepted. I systematically refused every time so that (usually after a few minutes) they would give up and cancel it themselves. This would usually happen for 2 or 3 drivers in a row, making ride-sharing a miserable experience for me.
I assume the cancellation penalties have been made much more serious, because this hasn't happened to me in a while now.
I've only had that happen a couple of times for me, but that's because I'm mostly a Lyft user. What was more common on Lyft was drivers calling me to ask "Where are you going?", and when I'd respond with "I already put my destination into the app", they'd hang up and cancel on me.
Edit: About the cancellation penalties. I don't know about Uber, but on Lyft when I as a rider have to cancel on somebody, I sometimes see options pop up saying "driver asked me to cancel" or "driver is not moving". They know when drivers are using trickery to get out of dinging their cancellation rate. And when I have to cancel for "driver is not moving", I also get a message saying they'll waive the cancellation fee because there was an issue with my ride (note: I get this message before I see the list of cancellation reasons to pick from, not after).
[1] https://help.uber.com/partners/article/getting-a-trip-reques...
First, the driver doesn't see your destination until he picks you up.
Second, there is no competition or reason to rush to "mash" the button, the ride request is exclusive to you as a driver for the 10 seconds that you see it.
Whenever I've raised this issue with Uber(via their absurdly bad support feature), I generally get an automated response in the line of "We're so sorry for the bad experience, we understand that this has caused you a lot of trouble... We take your feedback seriously..", etc.
As I noted in the comment, I use Lyft, not Uber, so I can't say if it works differently. What I can say (and what other people in this thread have confirmed) is that it does happen surprisingly regularly.
> First, the driver doesn't see your destination until he picks you up.
If that's the case, it's easy to see how even on Uber a driver might call you to find out where you want to go, and then tell you to cancel because they don't want to go there.
This is the exact reason I want Uber to lose this. Anything that would keep drivers classified as contractors is harmful to the actual customers, because the drivers being employees mean that they have to actually follow policies set by Uber.
So your argument is that drivers really set the price...
> (e.g. only during surge pricing)
And your example of drivers setting the price is...algorithms running at Uber and Lyft that set prices. Algorithms which Uber and Lyft would surely regard as proprietary trade secrets and resist disclosing to drivers, passengers, or government regulators.
How is that drivers setting prices, exactly? If an Uber driver wants to give me a ride to the airport, the Uber app decides that it costs $X. If that Uber driver believes that Uber's surge pricing model is inaccurate and thinks the real price should be $Y, there is no facility for me and the driver to negotiate on a different price.
"We are going to pay you $X, if you don't like it you can leave" is called a salary, not a marketplace.
Just like how contractors will have several contracts they are choosing between, drivers routinely use multiple apps in parallel so they can choose between various contracts/rides.
I suspect if/when this gets to a higher court, the whole thing will come crashing down, because to allow Uber's weaselly redefinition of common terms, would be to allow other classes of employment to similarly become unprotected.
You schedule dog walks and lodging in advance, so it is quite tempting to cut the middle man out once you find what you like. Not so with transportation.
Which is also one of the reasons that Uber became successful. A lot of the "Uber for..." companies that provided more personal services like massages or house cleaning failed for this exact reason. As soon as a user found a provider they liked it was easy for the two parties to come to a deal for ongoing service and cut out the tech company. That is how a lead generating company works. Uber doesn't function that way because the provider and the consumer don't have an ongoing relationship because the drivers have all been commoditized.
Ironically, taxi drivers are also contractors. I’m surprised nobody has brought up the fact that the status quo pre-Uber was a contractor model as well.
The real problem is that the Dynamex decision is legislation from the bench that redefines “contractor.” The historical definition of a contractor was basically only c in the abc test. It will be interesting to see how the court decisions come down. As the press release points out, the precedent so far is mixed.
That aside, if you think it’s a shallow criticism in this case, why do you think it required legislative action to have any effect? In other words, if this wasn’t legislation from the bench, ab5 is a noop.
As to AB5, I’m not really educated on the particulars of Dynamex or the political process around AB5 to opine on why it’s been codified. There are many possible reasons, ranging from a desire to try to freeze the law in place, to, as you say a “noop.” This, too, is just a part of the system.
AB5 is a law codifying the Dynamax decision--the precise opposite of legislating from the bench.
If I am an employee of a company, they are probably not going to let me work for a competitor while I am on the clock with them.
McDonalds doesn't care if I also work at Burger King. Target doesn't care if I also work at WalMart. A plumber is generally fine if their assistant also works for another one.
All of this is subject to still doing the first job satisfactorially, of course.
I’ve always wondered what would happen if legislation required them all to open Go their API’s so drivers could use some “app to rule them all” that talks to lyft, Uber and more and helps them choose the best assignments....
This is how the rideshare companies claim an absurdly high hourly rate for driving — you only get that rate while actually giving rides and it is generally infeasible to be giving rides all the time. The effective hourly rate is much lower.
https://www.foodandwine.com/news/fast-food-non-compete-agree...
"Amazingly, Healey’s office suggests that 80 percent of fast food workers are locked into these types of agreements."
Wonder why. (Hint: it keeps wages low and workers tied to their places of employ.)
Having the app enabled is being on-call for potential assignments, not actually working. In my youngest years, I did that for multiple temp agencies at the same time a lot. Are they employees of both? Sure. Multiple W-2 employers is not that uncommon for people doing temp work.
> How should benefits be calculated?
In most cases, they will probably work little enough for each as to not reach mandatory benefit eligibility under most employer mandates.
> If I am an employee of a company, they are probably not going to let me work for a competitor while I am on the clock with them.
If you are an employee of a company giving on-demand assignments, they probably aren't going to consider you on the clock merely because you have indicated you are available to take an assignment if it becomes available.
If there are minimum paid shift rules in play, they may consider you on the clock and demand exclusivity for the paid period once you accept a job, even if there is a lull between assignments, though.
But not simultaneously. Once I went to a neghborhod where I knew I would not get any Lyft rides (stodgy white folk in suburban San Diego) and took Uber rides specifically to nail bonuses on both platforms.
That said, if they were on on-demand W-2 temporary workers instead of contractors, then they’d probably be treated exactly like all such workers (who often are signed up with multiple agencies to receive assignments) are by their employers and not be paid when they were merely willing to receive assignments but only after they had been offered and accepted and were actually working on a particular assignment.
A coordinated Amazon/Uber/Lyft shut down in California would be something to behold.
That amount of money can go a long way. Unfortunately.
Failing that, if they are to be counted as individual contractors they should be able to negotiate like those: without one-sided deceptive deals.
This would take the pressure of other industries that use independent contractors, such as tech.
Right now a couple of bad actors like Uber, are ruining the independent contractor category of work. Forcing states to put more laws in place.
It's frightening to see people just lap that up because it happens to coincide with their day job. But nothing in labor law prevents a company like Uber from "disrupting work" and offering that flexibility to employees.
I agree with the OP, and I am not just "repeating the Uber party line". I believe 3 categories of work are needed:
1. Employee (e.g. current W2), where you have a single full-time employer who is primarily responsible for your wages and benefits.
2. Independent Contractor, where the IC has full control over their rates, where they do the work, their tools, etc.
3. "Flexible" employee, where the employee has full control over their hours and availability, and to work for multiple employers, but doesn't have control over rates or how the work is done.
Focusing on wall clock hours doesn’t make sense for these kinds of jobs.
1. It's not like it would be difficult to track all of the little chunks of time worked and add them all up. Everything is automated anyway, and nobody is filing time cards.
2. In the end, the wall clock is how workers experience time when they're out doing work for these companies. They get their bike out and go deliver food for a few hours, or get in their car and drive around the city picking up and dropping off passengers. It's not clear to me that the interstitial minutes between gigs should be considered free time for the workers that goes uncompensated. If they drop off a passenger and pick up a new one within five or ten minutes, they've been working continuously. They haven't had a chance to go home and take their socks off and relax. They're working. It seems like a step backwards for everyone's mental well-being to use technology to clock the exact minutes that they produce value for the company, and cut off their pay the instant they stop producing. It's like a widget assembly line monitored by cameras where workers get automatically clocked in only when they're physically touching the widgets, so that if they sit up to stretch, or walk over to the cabinet to grab a different tool, or even if the conveyor belt is sending the next widget over to be worked on, they stop getting paid. I wouldn't want to work like that.
3. The fact that someone can be doing work for multiple companies at the same time doesn't seem like such a big problem to me. If they're on a segment of a route in which they're simultaneously delivering a passenger and someone's lunch, they should get paid for both. And the same contiguous-time rules I mentioned in #2 above can apply - as long as they're continuously picking up lunches and passengers within a certain interval, they're working two jobs.
No, it doesn't; multiple W-2 employees is a common thing and the law has no assumptions that conflict with it.
(Multiple full-time W-2 employers, maybe, are something of an issue, but not merely multiple W-2 employers.)
> "Flexible" employee, where the employee has full control over their hours and availability, and to work for multiple employers, but doesn't have control over rates or how the work is done.
This seems like regular on-demand temp work, where pretty much every feature of that is routine, and has always been W-2. Sure, technology including platforms like Uber, et al., make it practical to have more rapid offer/accept cycles and finer-grained work assignments, but they don't fundamentally change the nature of on-demand temp work in a way which requires any different treatment legally than such work has historically been given.
The politics of what has occurred here is probably the pendulum swinging too far, but in the right direction: the classification of 'contractor' just isn't correct to describe these workers, and the legislature did its best to rectify that.
my experience is that this is hardly ever true in politics. Legislators are generally balancing what they think is right (or what they think voters think is right) with what is in their own self interest (such as getting re-elected). As a result, they most often do their best to serve their own self-interest first and foremost. They raarely try to rectify something if rectifying it is at odds with their self-interest.
Rectifying this situation would likely involve some third category "somewhere in the middle", but that's not what we got.
If there were 10 ridesharing apps, and any customer could reach any driver using a different app, would you still consider the driver as having not negotiation power? The driver could uncheck "allow riders from uber" if they didnt want uber provided leads. Ride hailing should be as open as SMS, and then drivers AND passengers would gain power in the relationship. By using government to benefit consumers and shun proprietary lockin, the issues could be solved without creating a new employee class. The root need for that class in the first place is Ubers anti-competitive side.
These apps would be pretty basic and just let the driver accept rides from either service from within the same app.
Dunno if this is actually a problem though...
[1] https://www.sfchronicle.com/opinion/openforum/article/Open-F...
You can work only when the platform routes a job to you, not “whenever you want”. It's on-demand temporary work with a faster “job is available, do you accept it?” cycle than most, but the general idea of such on-demand work as regular W-2 employment has been around for a long time.
It reminds me of before my software engineering career, when I was working at The Gap. The job wasn't great, but a lot of people really needed more hours. Unfortunately, there was a rule that nobody could work more than 29 hours a week. Everyone hated it. Employees hated it the most because if they needed extra money they couldn't take an extra shift. The managers hated it too because it was just more rules for them to deal with.
Apparently, this rule existed because there was a law saying that past 30 hours a week, employees had to get some extra benefits. Gap corporate just changed the job to avoid that law. As a result, that job got worse, and nobody got more benefits. Just unintended consequences.
Maybe I misunderstand, but what you're saying sounds vaguely like "I know what's better for you".
Finding new work can be painful, but the damages are over-stated because there's low friction to entering work that doesn't demand specialized skills. Do you have two hands and can walk? Great, you can work the french fry fryer at McD's.
"The popular Mackinac Island in northern Michigan has only 500 year-round residents but approximately 3,000 jobs in the summer months. Delays on the approval for seasonal worker visas this year forced one resort to temporarily close its restaurant."
When it's their "season", they're probably hurting for staff, but when it's not, all those thousands of people are out of work and need to try to find a new job...
I, for one, would much rather drive for Uber than run a fryer. To the point of willing to take a significant pay cut to avoid the fast food industry.
I know that the answer is "no" since you've already said "they can just go work a fast food fryer". But that's hard to reconcile with this last statement of yours.
People don't work in sweatshops because they love the job, they do it because its better than any of their alternatives
A group of people have been living off the land for centuries. At some point a government comes in and takes the land from them to sell to a factory owner so the government can profit. With no land to farm, working at that factory becomes their best option. But the workers get abused. Women get raped. Their pay is stolen. Still they don’t have a better option. They try to unionize. The government police come in and kill the union leaders. The people keep working there because they have no better option. That does not mean the situation isn’t horrible.
It’s not enough to say they chose this job freely. A lot of coercion goes on. How prevalent is this stuff? I’m not sure. But don’t assume most sweatshop workers just decided this was best with no coercion. People like you and me aren’t paying much attention and a lot of bad stuff happens when we’re not looking. It doesn’t help that corporations benefit greatly from reduced labor prices and so the media and advertisers don’t want to talk about these issues.
Here’s a great documentary on some of these issues: https://youtu.be/PxFwA-jw3X4
Rural life is dull, you have a limited social circle and limited access to culture. And you have few opportunities. People today still crowd into overpriced cities with poor living conditions, because they dream of 'making it', and they can't bear the thought of toiling away at agriculture (or at a lesser job).
In China, an entire generation has been uplifted out of poverty by voluntarily relocating off of farms and into manufacturing jobs, and it's been so successful that it's cited as a reason for the popularity of current authoritarian leadership.
We're not talking about subsistence farming vs driving for Uber here.
>People don't work in sweatshops because they love the job, they do it because they are desperate
>People don't work in sweatshops because they love the job, they do it because its better than any of their alternatives
The first statement is often part of a moral argument against exploitation and expressed in conjunction with a an desire or indifference to eliminating the job. The second is usually used in an argument which frames the worker as a rational actor and lacks the moral judgement.
A common, if inflammatory, example is sex work. On one hand, sex workers can be seen a desperate, vulnerable, and forced by circumstances into an inherently exploitative relationship. Those that hold this position often believe that sex work should be made or kept illegal to protect the individuals from this exploitation.
The alternative framing is that sex workers choose the job because it is the least bad of the available options. Removing the option will only push workers into a less preferable occupation.
- what appears like sweatshops are actually significantly preferable working conditions for the local population; workshops are hot and crowded sure, but it’s sheltered and beats back-breaking farming, where pests can eat your yearly revenue overnight; (that point you agree with, as far as I can tell)
- so much that, in some conditions “sweatshops” are a positive thing and local people are excited over it: they show up early, some singing, in their best clothes; (I have no evidence of this handy right now, you might disagree but if you read the first point, it shouldn’t be a surprise); example of that is the young rural Chinese workers who were happy to be hosted on bunk beds at Foxconn and others because that meant they could save more money, talking about it like Facebook grads talk about free food; that effect might not last, doesn’t appear to have for Foxconn (or Facebook);
- in the early conditions, “sweatshops” are great and external political forces trying to ban them, or more often regulate them out of profitability i.e. existence, comes off as horribly misguided attempts; an extreme version of “better is the enemy of good” difficult to parse for a population without many options;
- adding expensive controls works against workers’ expressed interests that could be either a. legitimate but conditional (they need the money and the local standards are low, working fast is a tiring but reasonable way to achieve their goal) or b. the capitalist version of Stockholm syndrome. In my experience, it’s nowhere easy to sort the two edge-cases apart. If that’s the case, a market-liberal option is to let bad employers loose their workers by making sure there’s low employment overall, the places with real opportunities can poach them away. Also essential: personal growth needs to happen; I wasn’t super hopeful that “the market” would deliver until Lambda school.
That line of reasoning has been the first criticism of trade and workers’ unions since the XIXth century and the vertiginous growth of the Industrial revolution: they defend current tradesmen and employees against newcomers. I think trade unions can do amazing things to help spread the wealth but I would be wary about that edge.
There are newer arguments in favour of Uber in that sense:
- how easy it is to get a job, fast even: a massive upside of Uber is that you can enrol under a day and get paid within seconds of dropping your passenger; people with stranger schedules, deaf people, with non-violent criminal background have testified in that sense; anyone familiar with “Growth”, especially on a platform would recognise the approach;
- at this point, “unintended” consequences are widely documented; public servants should expect rules like that would back-fire, and adapt their rulings; Uber’s margins or lack thereof are public; other similar companies have left markets, leaving their workers in the dust; it’s easy to confuse the valuation of an IPO with free cash, to mistake Growth for Profit (God knows every reporter covering tech makes that mistake) but I doubt that Uber can afford to raise compensation by a lot;
- there are now many alternatives in the gig-economy: bad employers cannot retain workers; e.g. Amazon’s warehouse would not retain anyone if they were that bad. I’m less familiar with Amazon and convinced by that one, but if you go on money-making/saving forums, you’ll notice how so many contributors have tried and compared dozens of gig-platforms. The common thread? Everyone there started by being excluded from the standard employment market by personal circumstances, unintended consequences of regulation, prejudice or sometimes just being a terrible human begin. But that’s the starting point.
I really don’t think that the gig economy is the solution: banning 29-hour limits, having incentives to accommodate for handicap, family life, etc. for any business that can shift hours also need to be in place. Few people want a series of gigs; for the few who do, what many of those companies have done isn’t worse than the alternative. For the many who want a stable, predictable job, I don’t think the solution is to regulate industries where tasks are, say, very time-specific.
Disclaimer: I’ve worked for Deliveroo (the non-US equivalent to Doordash) and dealt with those questions a lot. I’m overall proud of the work there, from many personal contacts with riders; I also have a litany of complaints handy, mainly because it was my job to prioritise them all (and there were a lot and many were really bad but not as bad as unemployment/dealing drugs/failing to make it as a Grime singer).
I would have a more critical take against Uber Taxi, mainly around how they abused the financial illiteracy of their workers. That’s one aspect I would certainly want to see regulated.
I drove for Uber and it was seriously the only job I could get and it saved my life. I know of many other drivers who are battling disabling conditions who drive for Uber as well. Jobs that are as flexible as Uber are non-existent.
I find it really disappointing how many people debate this issue without ever actually listening to the people in poverty. That means talking to real people doing the job. Not just the protestors in the streets. And frankly, if you have time to protest, you're probably not that poor. The poorest of the poor work whenever they can and do not spend time on things that don't earn them money.
The ideal approach is two pronged, you raise the standard which benefits society as a whole and increase the social safety net to take care of those few lost in transition.
The same principle applies to a wide variety of economic changes from increased labor regulations, to housing, to free trade, to automation. Your complaint here is mainly that we haven't followed through on protecting those caught in transition. We shouldn't fall into the trap of mistaking that for a valid criticism against raising the societal standard.
I think the best way to increase wages is more and more jobs so that workers have bargaining power. I've used Uber as a fall-back and it dramatically increases my bargaining power.
i dont know what protests you've been attending but the one's ive helped at for laundry and warehouse workers were filled with people that were not only supporting families on minimum wage but also contained people who were here on visas.
in america you're always taking a risk by protesting an employer.
This is, ultimately the major reason why the status quo never changes here: people dont want to acknowledge their class.
If the government really care about worker well being then the government should directly help them, instead of using company as middleman. For example by providing universal health care or universal basic income.
What is the purpose of the labor protection in the first place ? To help the worker right ? Then why not just directly help the worker.
Instead of forcing company to provide health care to their worker, why not the government itself provide health care directly.
Just because the fix is easier and more likely to achieve but if it doesn't address the core issue, its useless.
This shows up anytime people try to make some sort of progressive improvement to society, people come out of the woodwork to complain that it's not the right solution, without doing anything (other than complaining I guess) to motivate a better solution.
Still better than not saying anything.
That's not how it works. Uber isn't operating at a profit because their current-investor-subsidized-rates are below the cost of their service. But there is a bit of a chicken-and-egg problem there: there rates are low because they want to gain marketshare, which is only enabled by the flood of VC/IPO money.
Eventually, all of the rideshare companies will need to raise their rates to cover the cost of service, and that cost should include reasonable remuneration for their workers. If it turns out the market isn't viable at those costs (i.e. if people just stop taking rideshares altogether because it's too expensive), then it never should have existed in the first place.
I think we basically agree. The dangerous outcome is that Uber becomes more expensive for end users in California, Uber drivers become employees, but they make exactly minimum wage because that's the minimum Uber can pay them, and Uber's profits in California go to zero. (I doubt the Uber business will cease to exist because taxis are so bad in comparison.) Uber's market shrinks because they became more expensive, so they can hire fewer people.
Is that better for anyone? It sounds worse for both Uber drivers and for Uber users than the status quo. Unless you think that a minimum wage job is superior to the current job of Uber driver, and we really need more minimum wage jobs.
Which means it is inevitable that Uber will become more expensive, or it will fail. It's just a matter of time.
IMHO, the whole point of this law is just to weaken the existing precedent by giving exemptions to the Lawmakers' buddies and donors.
I can do 10 hours or I can do 0 hours based on nothing but my own whim. I don't have a problem with people organizing to get a better deal for themselves, but I like the way it works now.
I've worked for companies that misclassify workers, and Uber isn't it as far as I understand. I may be convinced otherwise, but I don't see it.
I guess the issue arises when we got people working full-time hours but still being classified as an independent contractor.
Why though? There's plenty of contractors in other industries that work exclusively for a single client, often for 40+ hours per week. In technology in particular it's more common than having multiple concurrent clients (per person, not per consultancy).
I think the situation is somewhat similar in the US except that instead of a legal maximum the contract must specify an explicit end date after which there must be a break in employment.
You raise a good point that labor law has an ugly bimodality regarding employee and independent contractor, where it might be better to refactor the law so that different protections apply based on some particulars of the arrangement. Working <10hrs/wk vs >20hrs/wk is one good place to draw a distinction.
Accounts with a history are very valuable to companies in the business of "creating organic public support".
Also an author can be part of a community bit have a motivation to drive a discussion in a certain direction.
In either case it doesn't mean the post, the author, or the history are "fake" but it can mean there is some level of astroturfing going on.
Anyway I've been informed the guidelines prohibit such insinuations and I can understand why as they are an easy accusation but don't lend towards evidence based or productive discussions so I've removed my comment.
"Please don't make insinuations about astroturfing. It degrades discussion and is usually mistaken. If you're worried, email us and we'll look at the data."
I'm a W-2 employee at the company I work for, and they don't dictate my hours.
That's not correct; the difference is that failure to fulfill such a requirement is a discipline issue (which can be dealt with by discipline up to an including termination), but not a pay issue based on hours worked as it would be for a non-exempt hourly employee.
https://www.lexology.com/library/detail.aspx?g=1b7b6851-8415...
To my knowledge, there are numerous business areas where it's possible to negotiate flexible work hours, so wouldn't this be here possible as well?
Basically there's a bunch of laws that spike certain expensive costs for employees if they work different amounts. Therefore its not very profitable to allow completely flexible work times. Otherwise many of their Hawaii drivers would drive for 21 hours for benefits, and the labor costs would be higher than if you were required to either drive for 20 hours or 40 hours.
I think ideally employees wouldn't be mandated to provide any expensive benefits to full-time employees and benefits would be centralized and funded through more taxation instead.
But mostly, uber is complaining because labor laws are complex
Ideally there wouldn't be a tradeoff, but in practice it seems like there is one.
Who are we really subsidizing here?
[1] https://www.vox.com/2018/10/2/17924628/uber-drivers-make-hou... (FWIW, I don't agree with all the math on their earnings, but there are a lot of other reports out there on that)
Whether or not Uber drivers are employees or contractors under Dynamex and the ABC test is an open question, but the Uber explanation of the bill's impact is more or less correct.
Since Uber rates drivers, does background checks, sets the routes, leases cars, etc., how does Uber plan to avoid this check? Do ratings sort drivers, or is Uber effectively creating a credential that governs the driver? What does the distribution of driver activity look like?
It’s hard to believe an all-or-nothing determination will hold. Surely some fraction of most-active drivers will end up getting called employees.
It’s one thing to explain the law (and case law) and yet another to provide an explanation with evidence. The latter is what we need (especially as voters), yet the former is what lawyers like to peddle because it makes them money. Uber’s post is almost 100% legalese. CEO Dara had an opportunity to make a grounded statement here, but didn’t.
Currently, most drivers seem to drive for both Uber and Lyft (based on their cars having stickers for both). But if classified as employees, and being guaranteed a minimum wage, then Uber/Lyft might require them to be exclusively available. As a result, the drivers will have to choose either Uber and Lyft and since Uber has more market share, they will likely choose Uber and Lyft will be squeezed out.
What am I missing/misunderstanding above?
Woah - I see Lyft as the one with the competitive advantage due to Uber's brand. Uber is toxic while Lyft is seen as friendly.
Another comment mentioned that Lyft might pay drivers more to keep them, but given that both Uber and Lyft are hemorrhaging money, it seems unlikely that either will be willing to pay drivers more. Also, Uber just needs to pay the same as Lyft for a little while, and just wait out the decline of Lyft due to AB5.
The post from Uber clearly states "In the US, 92% of drivers drive less than 40 hours per week, and 45% of drivers drive less than 10 hours per week."
Will drivers be entitled to minimum wages from all of the apps they have active, or only when they have a fare?
Will there be a single union to bargain with all of the apps, or individual unions?
TBH considering the language of the bill, it s very plausible to say that driving people around is not "their usual course". The same way that google is not an advertiser, and airbnb is not a hotel chain.
And yes, Uber does lease cars to its drivers.
Uber tells drivers where to go, and when, if the driver agrees to do the work. Uber regulates the kind of cars acceptable, and regulates who does the work. Your Uber driver can't subcontract the drive to another driver.
> Your Uber driver can't subcontract the drive to another driver.
Even if their ToS does not allow it , it's not the law
Uber regulates what cars are acceptable the same way an Ebay seller has to maintain some standards in their store. Similarly Ebay also verifies that you can even be a seller on their platform, just like Uber does with background checks, DMV checks, etc.
To your last point on subcontracting...I'm not even sure thats part of being a contractor or employee so its neither here nor there.
Drivers can absolutely sub-contract. most choose not to in the US but it's the core of how the Uber Black business functions (a limosine company with a number of employee drivers) and is still how it meets demand in developing markets or in developing economies.
https://help.uber.com/partners/article/i-want-to-become-a-fl...
I mean, that has been Uber's MO since they started. AirBnB too, nothing new about this
I think the legislature and many on HN believe that courts will think it's absurd that Uber's drivers are doing work "outside the usual course" of Uber's business. I'm inclined to agree, but I'm not a lawyer and I don't know how well written the law was or whether California courts will include legislative intent in applying that language.
For example, when the Lemon test applies to something, it's because all of its three prongs are true. Is that a "pass" or a "fail"? That distinction I think is irrelevant to the law, but I'm sure the litigants on both sides would argue that their argument is good ("pass"), and the opposing argument is bad ("fail").
A city putting up decorations for a religious event and denying others would argue that they have "passed" the Lemon test, while articulating that one of its conditions "fails".
A litigant against such a city would argue the city "fails" the test.
I did not want to use Uber's language ("But just because the [ABC] test is hard does not mean we will not be able to pass it") because their job is to frame things positively for their client. Passing the ABC test is trivial - I'm doing it right now! So are you! What we care about is whether or not the test applies to something, that is, it entails some consequences, and Uber is going to argue that one of the specific prongs of the test will fail. From their view, this is a win, and this is them "passing" the test.
So, I used the word apply.
An outcome like that may be possible here as an unintended consequence, with Uber and Lyft capping most drivers at 20hrs a week, and full time drivers splitting their time between the two (20hrs for each).
This is where one can say sure. But in reality with the lack of public healthcare, it's just hiding an large cost on society when the person ends up running up medical bills and is unable to pay.
Does it make me a Microsoft employee if I use Outlook to conduct business? Does it make me an Ebay employee if I sell things through ebay? Until Uber eliminates the ability for drivers to drive Uber and Lyft simultaneously, and bounce between the services at will, I DO view it as drivers paying for 1) a dispatch and messaging service 2) payment processing 3) insurance 4) a resume host 5) a customer funnel. Thats more than just a technology or software company, Uber sells transportation services to drivers. The fact alone that they can have two messaging/dispatch apps open at once, on two phones, makes me question, which company do you think the driver works for? Both simultaneously? Just the one that the passenger is from? Is having both Uber and Lyft open looking for passengers any different than listing something I have for sale on Etsy, Ebay and Amazon, and pulling the listing once it sells out?
If Microsoft is the one paying you, and dictating how you use Outlook, what you can say, who you talk to you - then yes, it does.
The only difference here is the payment. And to that end, if Outlook supported the ability to transfer money then it still wouldn't make Microsoft your employer...
a distinction without a difference. if you don't follow their parameters they kick you off, which feels a lot like dictating how its used to me
Similarly, Ebay's service is less dependent on how well you provide your commerce services, it pretty much lets the market determine your prospects on its platform. On the other hand, Uber is highly reliant on the conduct of its drivers and the service the provide.
I agree with others. These “gig economy” jobs are a different classification of worker that doesn’t currently exist. Dunno what the details should be but they aren’t quite contractors and they aren’t quite employees.
California could have taken the lead and helped define this new classification...
In the UK we have two classifications that are different from self employed (contractors). We have worker and employee. They're similar but differ in the level of control the employer has and the responsibilities of the employer.
The case in the UK decided that the drivers were workers but not employees.
More info: https://www.gov.uk/employment-status
I don't think your post makes a strong statement to this effect, but it suggests it, and it's good to be clear on this point.
If you can't figure out why the general statement I made is relevant in this context, no amount of explanation from me is going to solve that problem.
This isn't necessarily wrong, but if you want to make the claim, you'll have to say what that new classification is.
Current employment law has a well-evolved set of protections that help prevent employees getting too badly screwed. Traditional contractor relationships, on the other hand, use the power of the market (that is, the contractor ability to either easily switch clients or maintain multiple clients) to keep things fair.
If there's something in between, it can't be the status quo (we treat you like employees when it's convenient but call you contractors so we can screw you over). And it also can't be some midpoint, like an employee-lite, where Uber, etc, just exploit people 50% less than now but 50% more than they could with real employees.
There's a lot fewer clients to choose from but doesn't driving for Uber and Lyft simultaneously satisfy this to some extent?
The obvious Duck test is staring you in the face, that here is a new type of thing that only half looks like a duck, and should be treated as such, which is what rideshare companies have been arguing for forever, including at the legislative level. Instead of forcing a non-duck into a duck because of stupidity, lack of imagination, or pure emotional hatred for certain companies, the level-headed thing to do is to look at how such a new type of market really should work for the benefit of all participants. The race-to-the-bottom thing that drivers complain about is a consequence of ideological cock-blocking by pandering politicians unable to come up with a real solution between fucked-up taxi medallions and raw market forces. AB5's madness lies in pretending it's the 1950's and takes the cake in making it worse not just for gig companies but a shit load of other industries as collateral damage.
I'm not saying you are guilty of this, but I think many of us with full-time, salaried jobs tend to not be able to grasp that yes, you can be an employee of multiple companies simultaneously.
You can't necessarily be paid by more than one employer for the same unit of time -- but that's not what's happening here.
If a driver who is an employee of both platforms accepts a Lyft ride, they are working as an employee for that one company for the duration of the ride. If they then accept an Uber ride, they are working as an employee for that one company for the duration of the ride.
Keep in mind there's no minimum amount of time you have to work to be considered working as an employee. Even if you're clocking in for just 5 minutes, you're still a working employee for those 5 minutes and should get paid for those 5 minutes.
The only difference between this type of employment relationship and traditional employment relationships is that at least in theory, the drivers can set their own working hours. Although the degree to which Uber and Lyft exert influence over drivers' working hours makes me wonder just how freely chosen they are.
But even if Uber, Lyft, and the like are able to argue that drivers can freely chose their working hours, that's NOT the only criterion necessary to be considered contractors. It is possible to be able to freely chose your own working hours yet still be classified properly as an employee, provided other factors point toward an employment relationship.
Im not even making the argument that they are employees or contractors, I am more saying that drivers are consumers of Ubers matching service, and that there is some accuracy in viewing Uber as a matchmaking service and payment facilitator.
> due to eleventh-hour amendments to the bill, many industries are now exempt from the new ABC test that AB5 will codify into state law
Anyone have information on the exemptions added to the bill, specifically if it exempts most of the big tech companies?
> "Transportation as reliable as running water, everywhere for everyone"
Sounds like transportation is their core business to me.
No, it exchanges it for attention, which it sells, but an exchange of the world's information for other valuable commodities is key to it's business model.
> Contrary to some of the rhetoric we’ve heard, AB5 does not automatically reclassify any rideshare drivers from independent contractors to employees.
This may seem like an immediate contradiction, but I guess they've reframed it so their proposal is actually in line with AB5?
great pr-speak
> But just because the test is hard does not mean we will not be able to pass it. In fact, 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.
Also seems like they will continue to thwart where they can (which I can't blame them for really) but seems aggressive to note. This reads more like a shareholder update, which makes sense.
> Governor Newsom has already committed to sign AB5, which would go into effect in January 2020. Because we continue to believe drivers are properly classified as independent... drivers will not be automatically reclassified as employees, even after January of next year...
> Uber and Lyft together have already transferred $60 million into a campaign committee account, and we are open to investing more to put us in the strongest position possible to run a winning campaign... We are confident that California voters and the millions of riders and drivers who use Uber will step up to protect these important work opportunities.
Translation: "We're betting that we can get a ballot initiative passed legalizing what we do faster than the State of California can bust us for violating AB5."
> Importantly, our ballot measure will not ask voters to exempt us from AB5, even though nearly every other industry in California that works with independent contractors received an exemption from the ABC test through special amendments I mentioned earlier. Instead, we will ask voters to support the pro-driver policies we have advocated for: giving drivers access to benefits and an earnings floor and retaining the flexible access to on-demand work they enjoy today.
It doesn't sound like the proposal is intended avoid compliance with AB5 but to create conditions where new bills that make the ABC test harder pass will have less support.
What... how... I don't even know where to begin with this.
Pretty clever wording by Uber here, I'd say. Although does not make sense to me.
the problem with that argument is that they have a lot of control of the driver side of the platform, directly through pricing and indirectly through ratings and access.
Connecting riders and drivers is one thing which takes advantage of their technology but their are others. Connecting riders and scooters, connecting couriers to restaurants and hungry people, connecting people who want to go to the Hamptons with helicopters, etc.
Uber will argue that it has nothing to do with the driving part and the driving is just one of the many uses of their technology.
The difficult part of that argument will be that they have so many rules and regulations that they place on drivers and rides that's it's hard to argue they're just providing a hands-off matching & logistics service.
We expect we will continue to respond to claims of misclassification in arbitration and in court as necessary, just as we do now. But we will also continue to advocate for the independence and choice that drivers tell us again and again in surveys, polls, focus groups, and personal conversations that they value most.
Uber management is not going to get the message until top management goes to jail for contempt of court.
They will not be able to keep as many drivers or allow infinite drivers to sign up, and they will not be able to pay benefits to people who only work a very small amount per week (I assume this is in the law). But beyond that, there is absolutely no reason they cannot or should not continue to let drivers sign in and out when they want.
I understand A & B, but as for C, why does someone's normal job have to be in that same line of work to be considered an independent contractor? What does whether a person is a driver professionally, or a teacher making money on the side, determine whether they're performing work as a contractor?
Maybe someone more expert can explain.
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[1] ABC Test that all 3 conditions must be satisfied for worker to be considered a contractor:
"... (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; and (b) that the worker performs work that is outside the usual course of the hiring entity’s business; and (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 post talks about "potential harm" and says that how many hours drivers have to work and whether they can work for competitors at the same time "would all change." Is that right?
No one knows the true impact of this. Companies will find lots of interesting ways to follow the letter of the law but not the spirit of it. As they always do.
If you really want speculation on it then find someone who's actually a lawyer and not directly affected by it (so they aren't biased). Which I haven't seen yet.
(Detailed writeup on why speculation on things like this is almost always wrong http://larvatus.com/michael-crichton-why-speculate/ )
Honestly I think their argument could be bolstered a lot if they made a simple change. Imagine you call an Uber, then your app tells you billy wants your job. You can see he is 4.5 star rated with 1000 rides, he is est 3 min away, and he wants $15. Do you accept? If so Uber connects you. If not Uber goes back to finding someone else.
With that change Uber removes itself from being in the business of rideshare, and now is in business of connecting drivers with riders (as they’ve claimed all along). They need to let drivers dictate prices and ask users to choose.
"In the US, 92% of drivers drive less than 40 hours per week, and 45% of drivers drive less than 10 hours per week. [...] We will continue to defend the innovation that makes that kind of choice, flexibility, and independence a reality for over 200,000 drivers in California".
1. Does this distribution looks in California, not across whole US? Why talk about two different cases, unless you cherry pick? 2. How does this % look like, when we look at drivers that work for more than few months?
This subtlety could drastically change the data interpretation.
It would make sense that there are lot of drivers that don't drive very often. They might even have stopped driving altogether, but didn't cancel their account.
It's like a website talking about total users that ever signed up, instead of 7-day active users.
Fast food chain is busy from 12 AM - 2 AM, 5 PM - 7 PM. These shifts may be desirable or undesirable because of the time they occur. To be able to get the "easy" shifts (slow ones) at 10 PM or something, they can make it so that you HAVE to take a part of the other shifts... If you can't, you don't meet their eligibility and you lose your job.
If you are an employee in a shift based business, you definitely give up some rights to having completely flexible work hours.
Despite how it is covered, the law notably fails to do ANYTHING to help gig employees as it just codifies existing case law.
What this law does do is carve out exceptions in that case law so that gig employees have LESS protection.
This law could have been paired with other real protections for gig employees but that did not happen. No minimum wage guarantee extensions, no rights to organize, no improvements in access to the safety net...etc
How do people let our politicians get away with claiming they are protecting people with a bill that does nothing but erode those protections?
It is actually not a terribly bad idea. They have the money to pay for the slow court battle, and it is strictly cheaper than complying.
I'm sure some of the exemptions are not so cool though.
This sounds a lot like someone apologizing and saying they are deeply sorry, only after they are caught doing something wrong.
I think for many "big tech" companies there needs to be a paradigm shift in how society views them, not as pure tech companies that produce technology solely for technology's sake, but like Uber - companies that use tech as a means to an end of a another business (in most cases). Facebook as a news company, Amazon as a retailer, Airbnb as a short term rental unit provider, etc. (these aren't all necessarily accurate descriptions).
How can they be for self-organization of drivers (as states in the release) while battling in other state courts for prohibiting unions?
If they want to allow drivers to also drive for other platforms (again, from the text), just don’t enforce such clauses in employment contracts.
They’re talking about all the changes they supposedly want to see while the only thing stopping it from happening is Uber deciding not to.
As if being an employee must mean a rigid schedule and inflexible working hours.
> Establishing — for the first time ever — a guaranteed minimum earnings standard
> So as you can see, we are not arguing for the status quo.
Well, ok. The real question though is why.
Only companies with massive investments can afford to burn cash to keep the price to the final user as low as Uber's.
Such regulation would reduce the number of competitors appearing on the market.
Translation: "We want to help our workers by fighting against their own attempts to assert their legal rights. We will do so in special courts where we hire and pay the judges. This will be perfectly fair."
What? Those are embarassing offers.
> Our proposal avoids the potential harm of forcing drivers to be employees, whether or not they want to—and the vast majority tell us they don’t want to be
I would love to see the data behind the 'vast majority'
https://finance.yahoo.com/quote/UBER/
Looking at the 5 day stock trends, it seems up compared to last week.
Corps likely airbnb and uber should probably go back to building their platforms to promote occasional resource assignment rather than permanent.
This is the fiction sold by AirBnB, Uber, etc. You just can’t grow forever (as these companies require) by “sharing.” Do you think investors would continue to happily light billions on fire if Uber didn’t have huge ambitions?
This is very similar to Etsy. Founded as a handmade marketplace until they realized not enough people make stuff by hand to keep growing. Now it’s just a mass-produced shit shop just like every other place.
I guess we do live in a post-truth era.
And, of course, they will claim the most favorable definition. In other situations, notably when they are arguing against entrenched transit/transport interests, they "become" a transport company. It's a question of which hat fits the day.
> But just because the test is hard does not mean we will not be able to pass it. In fact, 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.
Previous rulings have found his statement to be accurate. So you don't have to take his word for it, you can take a judge's.
Lawyers and representatives have been making stretch arguments for the entities they represent for centuries. Did you really expect the company's legal group to not try and argue around this? Why do you think they have jobs?
(C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.
Seems a little bit contradictory?
Still wouldn't mind seeing another ride share app with carpooling as the focus.
The reality is that all these “gig economy” companies are only able to compete by unfairly claiming that their employees are somehow not their employees.
The build up to this legislation was that it was specifically around companies like Lyft, Uber, Dolly, etc. To argue against this just shows how desperate the company is to not give up anything.
Personally I stopped using Uber in 2016 and never looked back. I'd rather pay more for a Lyft. If both of them disappear tomorrow, there will always be Taxis; and maybe cities will finally start building out real mass transit like America has needed for decades, instead of hanging on to the brain-dead dream of a self-driving cab.