Uber, Lyft, DoorDash have launched a $90 million campaign to fight California's new labor law that is against many aspects of the gig economy.
The companies have started Protect App-Based Drivers & Services campaign to put a referendum on California's 2020 ballots. The ballot will ask voters to give ride-hailing companies an exemption to Assembly Bill 5.
Assembly Bill 5, which was signed into law by California Gov. Gavin Newsom on September 18th, allows the so-called "ABC test" for determining whether someone is a contractor or employee. AB-5 would require a business to prove its contract workers are free from company control, perform work that is outside the usual course of business for the company and have independently established businesses providing similar work, in order to be classified as such.
Legal experts agree the law will make it more difficult for companies like Uber, Lyft, and DoorDash to classify their drivers and couriers as independent contractors. And the companies have argued that the law represents a threat to their business models.
"The new law could take this flexibility away - potentially eliminating hundreds of thousands of work opportunities and forcing app-based drivers into rigid employment schedules whether they prefer it or not," the group wrote in a Q&A. "Furthermore, if rideshare and delivery drivers are forced to be classified as employees with set shifts, it could significantly limit the availability and affordability of these on-demand services that benefit consumers, small businesses and our economy."
The Protect App-Based Drivers & Services Act ballot measure includes a guarantee that drivers would make 20% more than the minimum wage, and 30 cents per mile for expenses such as gas and vehicle wear and tear.