California passes bill to remake gig economy (example: Uber and Lyft)

May 21, 2018
389

SACRAMENTO — California legislators approved a landmark bill on Tuesday that requires companies like Uber and Lyft to treat contract workers as employees, a move that could reshape the gig economy and that adds fuel to a yearslong debate over whether the nature of work has become too insecure.
The bill passed in a 29 to 11 vote in the State Senate and will apply to app-based companies, despite their efforts to negotiate an exemption. California’s governor, Gavin Newsom, endorsed the bill this month and is expected to sign it after it goes through the State Assembly, in what is expected to be a formality. Under the measure, which would go into effect Jan. 1, workers must be designated as employees instead of contractors if a company exerts control over how they perform their tasks or if their work is part of a company’s regular business.
It's just California, but just like how California's emission standards influence how carmakers build their cars across the whole nation, hopefully this has a similar effect.

I don't use Uber or Lyft regularly so I can't speak for people who regularly use these services in their daily lives, but good for the drivers!

EDIT: That not as great as expected loss for Uber in this thread:


is gonna get not so less once this bill goes into action.
 

Robochimp

Avenger
Oct 25, 2017
1,552
I'm curious, honestly have no opinion on the matter -- does this affect sites like fiverr?
The test seems to be how much control the company exerts over the work done. Fiver probably doesn’t meet that level, but no way of knowing until someone tests the law.

Edit: rereading it also includes wether or not the work is what the company does. Fiver doesn’t meet that either, so likely not effected.
 

Liyfda

Member
Oct 27, 2017
165
I'm curious, honestly have no opinion on the matter -- does this affect sites like fiverr?
At the time of this article, Sept 2nd, from The Verge, The bill does have a list of exemptions.
As such, AB5 exempts a lengthy list of professions, primarily ones in which the practitioners set their own rates. These include construction contractors, business-to-business services, freelance writers, fine artists, grant writers, graphic designers and podiatrists. The carve-outs also include doctors, dentists, lawyers, architects, accountants, engineers, insurance agents, investment advisers, direct sellers, real estate agents, hairstylists, barbers, estheticians and electrologists.
Fiverr probably falls under this since the freelancers set their own rates, if I'm not mistaken.
Edit: I can't make that statement confidently

 
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Oct 25, 2017
11,121
Last I read n this bill it was only for contractors operating in California, not the entire US. Should be interesting to see if other states follow suit
 
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TheLostBigBoss

The Fallen
Oct 26, 2017
8,910
Last I read n this bill it was only for contractors operating in California, not the entire US. So it will have an impact sure but not as large scale as it could
There are only a handful of US states that actually carry the majority of the US population, and California is one of them. California basically murdering gig-economy businesses by their reclassifications of workers is a big deal
 
Oct 25, 2017
11,121
There are only a handful of US states that actually carry the majority of the US population, and California is one of them. California basically murdering gig-economy businesses by their reclassifications of workers is a big deal
Yeah wasn’t meant to co e off like I’m downplaying the bill but it remains to be seen if other states follow. I haven’t read much on others paying attention, or not. Other big gig stuff has happened before ( Austin, NYC) and other states didn’t follow.
My hope is they do, especially with shit like fiverr
 

ShaunB

Member
Oct 25, 2017
286
Well that didn't take long.


Tony West, Uber’s chief legal officer, said in a news conference that the ride-hailing company would not treat its drivers, who are independent contractors, as employees under the California bill. He said that drivers were not a core part of Uber’s business and could maintain their independent status when the measure goes into effect as state law on Jan. 1.

Uber’s business, Mr. West said, is not providing rides but “serving as a technology platform for several different types of digital marketplaces.” He added that the company was “no stranger to legal battles.”
 

Afrikan

Member
Oct 28, 2017
4,076
what can be a negative for some drivers/janitors?

were there any that preferred the independent contractor designation?
 

Volimar

Moderator
Oct 25, 2017
10,975
Drivers are not a core part of Users business.....what is then? Do tell.
They've argued before that the technology of the app is their business and the people who use it, both riders and passengers, are consumers.

Edit: Basically saying that the drivers and passengers use the app to do their business, like buyers and sellers on Craigslist.
 

AlteredBeast

Member
Oct 27, 2017
2,298
Hope this doesn't end up negatively affecting me, I make great money doing Uber/Lyft as an independent, although I realize many people cannot or are not willing to work it like I do.
 

rob305

Member
Oct 27, 2017
952
Miami Beach, FL
Autonomous cars that can navigate streetsaand different weather are at least 10-20 years away from being ready, technologically. Even then, the first few years will require a driver at all times.
I mean i know elon musk is full of shit and i'd always add a year or 2 to his estimates, but if i recall correctly on the updated tesla roadmap early this year he had autonomous robotaxis for the end of 2021. Again, id add a year or 2 to that just because of his track record but i dont think theyre 10-20 years away
 

ErrorJustin

Member
Oct 28, 2017
314
Not for nothing but the "$5.2 billion loss" thing needs to stop being linked to over and over again. It's misleading at the very best.

That quarterly loss was a one-off and was a result of stock-based compensation for the company's employees; a side-effect of the company having just gone public. It was a completely planned for, expected, and anticipated result:

"Most of the loss reported Thursday was attributed to stock-based compensation associated with the initial public offering in May, a routine expense for newly public companies. The adjusted loss—a more commonly used metric for ride-hailing companies, which excludes interest, tax and other expenses—more than doubled to $656 million, but it wasn’t as large as the $979.1 million analysts expected."

You're all gonna roll-eyes and say "oh ok I guess they only lost $600 million" but facts matter - make sure you're arguing in good faith and you're actually informed.
 
Feb 1, 2018
2,233
This is going to wreck a lot of small businesses who can't really afford to have W2 employees

Anyway, Uber is likely just incentivized more now to automate faster and harder
 

Sankt Ra

Member
Oct 27, 2017
1,735
I mean i know elon musk is full of shit and i'd always add a year or 2 to his estimates, but if i recall correctly on the updated tesla roadmap early this year he had autonomous robotaxis for the end of 2021. Again, id add a year or 2 to that just because of his track record but i dont think theyre 10-20 years away
Yeah a year or two for certain sections of roads under Californian conditions on straight US streets. Not thought the city of Rome. That stuff is a decade away.
 

fontguy

Avenger
Oct 8, 2018
1,671
“You have to adhere to new standards and regulations under our new law that we, the government, passed.”
“Nuh uh.”
 

lake

Member
Oct 27, 2017
828
Someone I know is a contracted programmer for them. Gets only crappy-ish contractor's health insurance through the contracting company, doesn't have much theoretical job security, etc. Will this law affect people like her?