Gig economy firms such as Lyft and Uber have battled hard to stop treating employees as full-fledged workers, but they may not have much option in California before long. The state Assembly has issued the AB5 bill, which might need companies to state that somebody is a self-governing contractor and hence does not merit workers advantages. They might have to show that an employee is not managed by the firm, is not performing jobs at the core of the firm’s business, and controls their own separate business. If not, they would have to be treated as workers and receive advantages such as minimum wages, overtime pay, parental leave, and health care.
The bill still has to pass the Senate prior to it can turn out to be a law, even though that is believed highly likely.
There are exceptions to the bill or lawyers, health care, other fields, and real estate agents, partially because they are more probable to have genuine separate contractors. On the other hand, the action is obviously aimed to classify couriers, ridesharing drivers, and similar gig employees as workers. That might give employees a much solid safety net, even though it might also significantly increase costs for the firms.
On a related note, the New York Supreme Court earlier ruled to support minimum wage by New York City for drivers operating for ride-sharing platforms, eliminating down a challenge to the rule by Lyft. The verdict will sustain the New York TLC’s (Taxi and Limousine Commission) minimum salary need of $17.22 hourly after expenses, which is one of the first salary floors for ride-share employees in the nation.
In an interview offered to the media, a spokesperson Lyft claimed, “The rules by TLC have hurt profit opportunities for employees, and will remove competition that advantages riders and drivers.”
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