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Gig Firms Ask California to Rescue Them From Court Ruling
By Josh Eidelson
6. август 2018.

Leading gig economy companies including Uber and Lyft are quietly lobbying California’s top Democrats to override or undermine a court ruling that could make many of their contract workers into employees.

In April, the California Supreme Court issued a far-reaching ruling which could make it much harder for companies to claim their workforces of independent contractors are not full-fledged employees under the state’s wage laws. Over the months since, business leaders have been pleading their case to state officials including members of Governor Jerry Brown’s cabinet, Brown’s presumed successor Gavin Newsom, and members of the state legislature.

The business leaders are pushing to blunt the ruling’s impact, either through legislation or through executive action by the governor -- moves that would reverberate across the national debate over the rights and roles of workers in the modern gig economy, and what Democrats’ posture toward tech companies should be.

“The magnitude of this issue requires urgent leadership,” nine companies wrote in a July 23 letter reviewed by Bloomberg, which warns of the ruling “stifling innovation and threatening the livelihoods of millions of working Californians” and says that without political intervention it will “decimate businesses.” The letter was sent on behalf of Uber Technologies Inc., Lyft Inc., Instacart Inc., DoorDash Inc., Postmates Inc., TaskRabbit Inc., Square Inc., Total System Services Inc. and Handy Technologies Inc. It was addressed to the governor’s secretary of labor and cabinet secretary.

A spokeswoman for the governor’s office declined to comment on whether Brown, whose final term ends in January, was mulling granting the companies’ pleas.

An executive at one of the companies behind the push, speaking on condition of anonymity, said that because Brown and Newsom are both pro-tech and pro-worker, they are uniquely positioned to strike a compromise with the potential to be replicated. Forging a balance between the need for flexible, scalable work arrangements and workers’ rights shouldn’t just be left to the courts or calculated based on old models, the executive said.

Spokespeople for Lyft, Handy, TaskRabbit, Square, Postmates and Instacart declined to comment on the companies’ lobbying efforts. DoorDash did not respond to inquiries. Spokespeople for TSYS and Uber referred requests for comment to the California Chamber of Commerce, which has been an outspoken opponent of the new requirements. “If you have a business model that doesn’t lend itself to the strict structure that an employer-employee relationship dictates,” said the Chamber’s president and CEO Allan Zaremberg, then the ruling “puts you in a situation that it’s almost impossible to continue your business model.”

Zaremberg declined to comment on the prospect of executive action from the governor’s office, but said the Chamber aims to get a legislative fix introduced and passed by the state’s assembly and senate before the legislative session closes at the end of the month. Without it, he said, workers and companies alike will be “hamstrung,” and whole sectors of California’s economy could be in jeopardy. “People depend very much now on an on-demand economy,” said Zaremberg. “In the worst-case scenario, it isn’t a viable business model anymore.”

The California Labor Federation pledged Sunday to resist the efforts to suspend or reverse the ruling. "With income inequality at an all-time high and millions of working families struggling to survive in this unfair economy, why would our state’s leaders intervene to protect big corporations from paying the wages owed to their workers?" said the group’s legislative director Caitlin Vega.

Federal and California state laws entitle employees to a suite of rights including minimum wage, overtime pay, protection from sexual harassment, payroll tax contributions from employers and the chance to win collective bargaining. Those perks don’t extend to independent contractors, a category for workers with greater autonomy to choose the terms of their work. The boundary between an employee and a contractor can be fuzzy, though, and is defined differently under different laws. The question of who gets employee protections has been hotly contested in a slew of government agency proceedings and lawsuits around the country, frequently targeting app-based sectors like ride-sharing as well as older industries such as trucking and health care.

The April ruling in the California case, Dynamex Operations West Inc. v. Superior Court of Los Angeles, established what’s sometimes called an “ABC” test for enforcement of the state’s wage laws. Among the key elements of the new standard, which is more stringent than most states’ or the federal government’s, is the determination that people are employees of a company unless they are conducting “work that is outside the usual course” of the company’s business. For businesses whose core capacity is delivering a service to customers via an army of workers classified as independent contractors, that could be a challenging test to pass.

The court ruling applied only to California, but companies worry that, along with upending their operations in the nation’s most populous state, it could be a harbinger of things to come elsewhere. The week after the Dynamex decision, U.S. Senator Bernie Sanders introduced a bill -- backed by a handful of fellow potential contenders for the Democratic Party’s 2020 presidential nomination -- that would make an equivalent ABC test the standard for federal labor laws, like who has the right to unionize.

Rather than treating that as an idle threat, the U.S. Chamber of Commerce has already been lobbying congressional offices about the bill, according to federal disclosures. In meetings with U.S. Senate staff, business leaders have been emphasizing the downsides of Dynamex’s ABC test, according to a person familiar with the conversations. Getting Democratically controlled California to pump the breaks on its new court-decreed standard could also have a significant impact on national-level discussions.

In their letter to Governor Brown, the businesses floated options to curtail the ruling’s influence. Those included issuing an executive order barring state agencies from implementing the ABC test, reviving a defunct state commission that could amend it and passing legislation that would suspend it. The companies cite an estimate by the pro-free-market research group R Street Institute that more than 300,000 California workers could be newly considered employees rather than independent contractors due to the ruling. Once the imminent damage from Dynamex is averted, the companies say in the letter, there could be “a robust legislative discussion about how we can collectively invest to protect worker voices and benefits” in the new economy, as well as a “balanced test” for who is an employee.

Besides the letter, the companies have also met with the governors’ office to plead their case, according to a person familiar with the matter, who asked not to be identified because the meetings were private. And they have discussed the issue with the Democrats who lead the state’s assembly and senate and with Lieutenant Governor Newsom. Spokespeople for Newsom, Assembly Speaker Anthony Rendon and Senate President Pro Tempore Toni Atkins declined to comment.



Gig-economy startups aren’t the only companies concerned. The “I’m Independent” Coalition, a project of the California Chamber of Commerce devoted to opposing the ABC test, also counts the Internet Association as a backer. The association’s members include Google, Amazon and Facebook, all of which also hire contractors. “The internet industry is concerned about the implications of the Dynamex ruling and its potential to jeopardize internet-enabled, freelance work,” the association’s California government affairs director Kevin McKinley said in an emailed statement.

The Chamber’s coalition also includes the state associations representing restaurants, retailers, publishers, hospitals, shopping centers, child-care providers, farms, grape growers, manufacturers, trucking, taxis, ambulances and insurers. The coalition has gathered statements from workers about why they prefer to be classified as contractors, and is working to mobilize some for an Aug. 15 rally at the state capitol in Sacramento.

Company officials are also urging their own workers to join the cause. On Thursday, DoorDash sent an email to its “California Dashers” telling them that the Dynamex ruling threatens their “flexibility to choose when, where and how you want to work,” and providing a web tool to send their state legislators a message asking them “to help protect my freedom to choose the way I work.”

Attorney Shannon Liss-Riordan, who represents a worker suing DoorDash, responded by filing a motion Friday in federal court asking a judge to enjoin the company from "engaging in further coercive and misleading communications" that she alleged encourage workers covered by her putative class action lawsuit to "undermine their claims" in the case. DoorDash did not respond to inquiries.

Workers’ advocates have argued that responsible companies should welcome the clarity of the court’s April ruling. “It’s been a bit of a free-for-all, particularly in California, where a whole economy of companies has risen up in recent years saying that they can build their workforce off of workers that don’t have any employment protections,” said Liss-Riordan, who also represents workers currently suing other gig economy companies including Uber, Lyft and Postmates over alleged denials of employee rights (the companies have denied wrongdoing).

Labor advocates say there’s no reason for California to water down workers’ rights. “These companies continue to have choices about their business model,” union leaders from the state’s building trades, Teamsters union affiliates, and AFL-CIO chapter told Governor Brown and legislative leaders in a July letter reviewed by Bloomberg. “They can convert workers to employees and retain control over their work rules and their rates. Or they can contract with true independent contractors. The only thing they can’t do after Dynamex is have their cake and eat it too.”

https://www.bloomberg.com/news/articles/2018-08-05/gig-firms-ask-california-dems-to-rescue-them-from-court-ruling

BY SUSAN FOWLER
SEPTEMBER 2018

Of course, the threads of this disillusionment are woven into the very structure that has made these start-ups so successful. A few weeks into my tenure at Uber, where I started as a software developer just a year after graduating from college, still blindly convinced I could make the world a better place, a co-worker sat down next to my desk. “There’s something you need to know,” she said in a low voice, “and I don’t want you to forget it. When you’re writing code, you need to think of the drivers. Never forget that these are real people who have no benefits, who have to live in this city, who depend on us to write responsible code. Remember that.” I didn’t understand what she meant until several weeks later, when I overheard two other engineers in the cafeteria discussing driver bonuses—specifically, ways to manipulate bonuses so that drivers could be “tricked” into working longer hours. Laughing, they compared the drivers to animals: “You need to dangle the carrot right in front of their face.” Shortly thereafter, a wave of price cuts hit drivers in the Bay Area. When I talked to the drivers, they described how Uber kept fares in a perfectly engineered sweet spot: just high enough for them to justify driving, but just low enough that not much more than their gas and maintenance expenses were covered.

Those of us on the front lines of the gig economy were the first to spot and expose its flaws—two months after leaving Uber, I wrote a highly publicized account of my time there, describing the company’s toxic work environment in detail. Now, as Silicon Valley struggles to come to terms with its corrosive underpinnings, a new vein of disquiet has wormed its way into the Slack chats and happy-hour outings of low-level rank-and-file engineers, spurred by a question that seems to drown out everything else: What have we done? It’s a question that I, too, have been forced to grapple with as I notice how my job as a software engineer has changed the nature of work in general—and not necessarily for the better.

Gig-economy “platforms,” as they’re called, take their inspiration from software engineering, where the goal is to create modular, scalable software applications. To do this, engineers build small pieces of code that run concurrently, dividing a task into ever smaller pieces to conquer it more efficiently. Start-ups function in a similar way; tasks that used to make up a single job are broken down into the smallest possible code pieces, then partitioned so those pieces can be accomplished in parallel. It’s been a successful approach for start-ups for the same reason it’s a successful approach to writing code: it is perfectly, beautifully efficient. Across so-called platforms, there are no individuals—no bosses delegating tasks. Instead, various algorithms run on the platform, matching consumers with workers, riders with the nearest driver, and hungry customers with delivery people, telling them where to go, what to do, and how to do it. Constant needs and their quick solutions all hummingly, perpetually aligned.

By now it’s clear that these companies represent more than a trend. Though it’s difficult to accurately determine the size of the gig economy—estimates range from 0.7 to 34 percent of the national workforce—the number grows with each new start-up that figures out how to break down another basic task. There’s a relatively low risk associated with launching gig-economy companies, start-ups that can engage in “a kind of contract arbitrage” because they “aren’t bearing the corporate or societal cost, even as they reap fractional or full-time value from workers,” explains Seattle-based tech journalist Glenn Fleishman. Thanks to this buffer, they’re almost guaranteed to multiply. As the gig economy grows, so too does the danger that engineers, in attempting to build the most efficient systems, will chop and dice jobs into pieces so dehumanized that our legal system will no longer recognize them. And along with this comes an even more sinister possibility: jobs that would and should be recognizable—especially supervisory and management positions—will disappear altogether. If a software engineer can write a set of programs that breaks a job into smaller increments, and can follow it up with an algorithm that fills in as the supervisor, then the position itself can be programmed to redundancy.

A few months ago, a lunchtime conversation with several friends turned to the subject of the gig economy. We began to enumerate the potential causes of worker isplacement—things like artificial intelligence and robots, which are fast becoming a reality, expanding the purview of companies such as Google and Amazon. “The displacement is happening right under our noses,” said a woman sitting next to me, another former engineer. “Not in the future—it’s happening now.”

William Murderface wrote:Mislim da je onthotherhand očigledno kritičan prema tim trendovima.

William Murderface wrote:
Pa valjda taj ishod zavisi i od neke politike, nije svakako zapisan u kamenu. Masine su here to stay, ljudski rad je sve manje neophodan. Pitanje je samo ko ce da uziva plodove.

beatakeshi wrote:može loše, a može i gore.

паће wrote:Има у тој гажној привреди^РЖ једна ствар која је јебе, а то је време и поступак између два радника на истој ствари. Пошто је цео прц у томе да немају сталне раднике и нарочито не са радним временом, него их позивају кад шта треба а ови има да су на располагању, чим на једној ствари треба да ради више њих то почиње да се компликује. Може на гажу да ради малопродаја, перионица, разношење, кошење траве - ствари где 1 радник уради 1 ствар па је посао завршен и одмах наплатив. Може донекле и градња, то је увек и радило на то да има помоћних и повремених радника, и то да не морају да буду нарочито стручни.

Ал' ајде да замислимо да тако ради млин, електрана, железница, или гомила служби које морају да имају посаду од-до (нпр хитна, изношење смећа). Не видим како би то могло да се разбије на гомилу ситних послића који могу да сачекају да се појави неко да их уради.

bjesomučje wrote:
sa druge strane, na primeru ubera, vidimo da to i nije prekarno odnosno nesigurno, samo je relativno povremeno, a možda nije ni to. rad za uber je izuzetno siguran, uber ti neće dati otkaz osim ako te ne banuju kad nešto zasereš (ili ti kreten da nezasluženu lošu ocenu), a posla uvek ima.

bjesomučje wrote:

паће wrote:Има у тој гажној привреди^РЖ једна ствар која је јебе, а то је време и поступак између два радника на истој ствари. Пошто је цео прц у томе да немају сталне раднике и нарочито не са радним временом, него их позивају кад шта треба а ови има да су на располагању, чим на једној ствари треба да ради више њих то почиње да се компликује. Може на гажу да ради малопродаја, перионица, разношење, кошење траве - ствари где 1 радник уради 1 ствар па је посао завршен и одмах наплатив. Може донекле и градња, то је увек и радило на то да има помоћних и повремених радника, и то да не морају да буду нарочито стручни.

Ал' ајде да замислимо да тако ради млин, електрана, железница, или гомила служби које морају да имају посаду од-до (нпр хитна, изношење смећа). Не видим како би то могло да се разбије на гомилу ситних послића који могу да сачекају да се појави неко да их уради.

ja bih rad u gig ekonomiji definisao kao društveno delegitimisan rad, ne kao klasičan nesiguran i/ili povremen rad. ja mislim da su to različite stvari. gažni posao je "posao koji to nije", odnosno onaj ko radi taj posao ima stigmu budale koja forsira nešto što nije namenjeno, prvobitno zamišljeno, tehnološki predviđeno da se radi kao da je klasičan posao, ali po svim elementima jeste stalni, tekući, rad. sa druge strane, tipičan prekarni rad nema nikakvu naročitu stigmu, i može biti i solidno vrednovan, odnosno "legitimisan" kao pravi, istinski rad koji ima i da se adekvatno plati 

sa druge strane, na primeru ubera, vidimo da to i nije prekarno odnosno nesigurno, samo je relativno povremeno, a možda nije ni to. rad za uber je izuzetno siguran, uber ti neće dati otkaz osim ako te ne banuju kad nešto zasereš (ili ti kreten da nezasluženu lošu ocenu), a posla uvek ima. 

tako da se tu dešava jedno divergiranje i više se ne može pričati o klasičnom prekarnom radu u slučaju tih haj tek kompanija

ono što je zanimljivo je koja još područja rada može da inficira taj mim o poslu koji nije posao. možda će jednog dana biti "što voziš toliko ta kola hitne pomoći, de uzmi nešto zanimljivo da učiš i da se usavršavaš i sredi više taj sivi"

verovatno se jedan značajan segment novijih generacija iskreno pita "kako je moguće da neko vozi autobus, da džedži napolju kao saobraćajac itd - kako je moguće, zašto ti ljudi rade to?"