On Saturday, May 1^st at 10:45 AM (PT), Rand Wilson and Peter Olney took part in the panel “Organizing Workers in the Gig Economy”.  Watch the recorded discussion HERE

Of course, after winning in California, we knew they wouldn’t stop there. Their big win on Proposition 22 last November has emboldened Uber, Lyft, and the whole constellation of gig economy companies to undermine employment standards and workers’ rights in other states.^[1]

The hyper exploitation of ride share drivers by Uber and Lyft and other gig companies is premised on using a cell phone application (or “app”) to enlist workers as drivers or delivery workers.  The companies claim that the drivers are not their employees but instead are independent contractors. With this reasoning, management is not obligated to comply with wage and hour laws, or pay into workers’ compensation, unemployment, and state disability insurance funds.  And by classifying their employees as independent contractors, drivers do not have access to federal protections from discrimination or collective bargaining and other worker rights under the National Labor Relations Act.^[2]

The gig economy companies mobilized after a 2018 California State Supreme Court decision, “Dynamex,” ruled that a simple “ABC test” should be applied to determine whether an individual is an employee or a contractor. California codified that decision when it enacted Assembly Bill 5 (AB 5) in September 2019 and tightened the criteria for worker classification.^[3]

Under the ABC test, a worker is considered an employee and not an independent contractor, unless the hiring entity satisfies all three of the following conditions:

• The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;
• The worker performs work that is outside the usual course of the hiring entity’s business; and
• The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.^[4]

The Dynamex decision and California’s AB 5 law fundamentally threatened the rideshare companies’ business model. The companies responded with a ballot initiative, Proposition 22, to pass a law carving out rideshare drivers from AB 5’s regulations. 

Uber, Lyft, and DoorDash claimed that if their ballot initiative passed drivers would receive guaranteed pay equal to 120% of the minimum wage plus 30 cents per mile to cover expenses, as well as access to health insurance.  However, after considering multiple loopholes in the initiative, a research study estimated that the promised pay guarantee for Uber and Lyft drivers is actually equivalent to a wage of only $5.64 per hour.^[5]

Rideshare Drivers United (RDU),^[6] a grass roots organization of Uber and Lyft drivers based in Southern California, campaigned valiantly against Proposition 22. RDU was joined by the California Labor Federation and its affiliates in officially opposing Prop 22.^[7] But they were outgunned, out messaged, and outspent $205 million to $14 million.^[8] The unions decided not to canvass voters at their doors during the pandemic –surrendering their most powerful weapon: an organized ground game. 

The pro Prop 22 forces developed a slick media campaign that showcased immigrants and people of color at the wheel of their cars talking about their desire for “flexibility” and the great benefits of driving for Uber or Lyft. The meager anti Prop 22 budget could not come close to matching the media campaign and the lack of a door-knocking program meant the corporations carried the day, winning 58.63% to 41.37%.^[9]

While the gig companies are looking at campaigns in Colorado, Illinois, and New Jersey, Massachusetts appears to be where the next high profile battleground will take place.^[10] Uber and Lyft have created a “grass-tops” coalition, the Massachusetts Coalition for Independent Work,^[11] to push several bills in the state legislature that would undo the state’s ABC test.^[12] Most observers believe their bills will die in committee on Beacon Hill. However, like California, Uber and Lyft will likely resort to placing a referendum question similar to Prop 22 on the state ballot in November 2022. 

The definitive margin for Prop 22 in California shows just how hard it will be to win in Massachusetts. And we know in advance that the campaign to preserve the ABC classification test will be heavily outspent by the gig industry. However, a smaller media market, the 2022 governor’s race, other ballot initiatives, and the lessons of California may help equal the playing field. There are four keys to a different outcome in Massachusetts:

• Doors, doors, doors – Pandemic or no pandemic the campaign needs to mask up, stay socially distant, but knock on voters’ doors;
• California dreaming? – Immediately after the passage of Prop 22 the gig companies in California began slicing promises they made to drivers for health insurance and higher income. And in the wake of Prop 22, other companies like Albertsons and Vons began to take advantage of the law by firing their employees and hiring DoorDash to make deliveries.  The campaign must be about all workers, not just drivers. 
• Powerful pathos – The motives and consequences of gig employment must be exposed! Hundreds of gig drivers will need to be recruited and trained to tell their stories contradicting the paid media narrative. 
• Unity and solidarity – the campaign must be about uniting working people against powerful corporations and the greed behind their initiative.  We will need many heartrending stories of employees denied their FLSA protections and employee rights because of misclassification.

The simultaneous 2022 ballot to amend the state constitution allowing a special tax on millionaires and a hotly contested race for governor will also create a grassroots advantage. Combined these campaigns should yield a very large progressive turnout.  However, it remains to be seen if suburban liberals and the intelligentsia that has historically been snowed by the “new economy” discourse will be open to a critique of the false promises of the gig economy. 

On the one hand, we saw how liberal Democrats folded when the hospital industry spent $25 million to defeat the nurses’ union ballot for staffing ratios in 2018.^[13]  On the other hand, a proposal to expand charter schools backed by a $26 million campaign was soundly defeated in 2016.^[14] Let’s be optimistic, if Robert Reich can go from being a pro NAFTA and new economy guru as Secretary of Labor to a staunch defender of worker rights, then there is hope that liberal opinion leaders and state elected leaders will be on our side.

Stopping Uber and Lyft cold in Massachusetts would be of enormous significance nationally. A defeat for the ride share driver companies could propel broad federal legislation making worker mis-classification much harder and undoing toxic state measures like Proposition 22 in California. Imagine a Bay State banner that reads, “Yes Uber and Lyft: Blame me, I’m from Massachusetts!”

…

Watch the recorded discussion here

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^[1] “2020 California Proposition 22,” https://en.wikipedia.org/wiki/2020_California_Proposition_22, “California Proposition 22, App-Based Drivers as Contractors and Labor Policies Initiative,” https://ballotpedia.org/California_Proposition_22,_App-Based_Drivers_as_Contractors_and_Labor_Policies_Initiative_(2020)

^[2] “Uber Was Designed to Exploit Drivers,” Ankita Rao, Vice, https://www.vice.com/en/article/3k3kdn/uber-was-designed-to-exploit-drivers

^[3] https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB5

^[4] “Independent contractor versus employee,” State of California, Dept. of Industrial Relations, https://www.dir.ca.gov/dlse/faq_independentcontractor.htm

^[5] “The Uber/Lyft Ballot Initiative Guarantees only $5.64 an Hour,” Ken Jacobs and Michael Reich, October 31, 2019, https://laborcenter.berkeley.edu/the-uber-lyft-ballot-initiative-guarantees-only-5-64-an-hour-2/

^[6] https://www.drivers-united.org/

^[7] “NO ON PROP 22 FACT SHEET, California Labor Federation, “https://calaborfed.org/no-on-prop-22-faq/

^[8] “Uber And Lyft Spent Hundreds Of Millions To Win Their Fight Over Workers’ Rights. It Worked.” Caroline O’Donovan, BuzzFeed, November 21, 2020, https://www.buzzfeednews.com/article/carolineodonovan/uber-lyft-proposition-22-workers-rights

^[9] “2020 California Proposition 22,” https://en.wikipedia.org/wiki/2020_California_Proposition_22

^[10] “The Gig Economy Is Coming for Millions of American Jobs,” by Josh Eidelson, Bloomberg, February 17, 2021, https://www.bloomberg.com/news/features/2021-02-17/gig-economy-coming-for-millions-of-u-s-jobs-after-california-s-uber-lyft-vote

^[11] In a January 28 email to community and religious groups, it stated, “The coalition’s goal is to help develop a modern legislative framework that can protect workers’ ability to choose their schedules and earn income on their terms, while also gaining benefits and protections. Overall, the coalition aims to expand opportunities for workers across all demographics, ethnicities, and backgrounds; strengthen transportation and delivery equity that helps all communities grow and thrive; help brick-and-mortar small businesses, restaurants, and retailers compete in an increasingly online economy; and protect those communities that rely on independent workers and app-based services for their essential needs.”

^[12] House Docket 2901, “An Act relative to the definition of an independent contractor,” and House Docket 2904, “An Act relative to independent contractors.”

^[13] “Hospitals spend record $25M to defeat nurse patient ratio ballot question,” By Jessica Bartlett  –  Reporter, Boston Business Journal, Feb 25, 2019, https://www.bizjournals.com/boston/news/2019/02/25/hospitals-spend-record-25m-to-defeat-nurse-patient.html

^[14] “Massachusetts votes against expanding charter schools, saying no to Question 2,” by Shira Schoenberg, Jan 07, 2019, MassLive, https://www.masslive.com/politics/2016/11/massachusetts_votes_against_ex.html