Uber, Lyft and DoorDash Pledge $90 Million to Fight Driver Legislation in California

SAN FRANCISCO — A bill in California’s Legislature could soon force ride-hailing companies like Uber and Lyft to treat their drivers as employees instead of independent contractors.

But Uber and Lyft, which contend that changing the legal status of their drivers poses a fundamental threat to their businesses, said Thursday that they would spend $ 60 million on a ballot initiative that would essentially exempt them from the proposed law. After their announcement, DoorDash, the food delivery service, said it would contribute an additional $ 30 million.

Drivers for Uber, Lyft and DoorDash work as independent contractors, logging in to the companies’ apps and providing rides or delivering food whenever they choose. They have no legally protected minimum wage, guaranteed sick days or traditional health benefits.

The drivers have routinely complained that the companies can cut their earnings without explanation and that they have no recourse if they are kicked off the apps.

As the bill that could give drivers employment status, Assembly Bill 5, winds its way through the Legislature, Uber and Lyft have urged a compromise that would allow drivers to remain independent contractors.

But the bill’s sponsor, Assemblywoman Lorena Gonzalez, a Democrat from San Diego, has said she does not foresee a deal with the companies.

“Billionaires who say they can’t pay minimum wages to their workers say they will spend tens of millions to avoid labor laws,” Ms. Gonzalez wrote on Twitter on Thursday. “Just pay your damn workers!”

A vote on the bill is expected before the legislative session ends in mid-September. That means time is running out for Uber and Lyft to strike a bargain.

The companies said their proposed ballot initiative would preserve drivers’ ability to set their own schedules, while Uber and Lyft would offer a concession on minimum wage standards, health benefits and collective bargaining rights.

In an email to drivers that urged them to contact their local lawmakers, Uber said it would guarantee a minimum wage of $ 21 per hour while a driver had a passenger or was on the way to pick one up.

The companies said they would also push for so-called sectoral bargaining, which would allow drivers across the ride-hailing industry to band together in labor negotiations.

This style of bargaining is different from the typical model in the United States, in which a union negotiates with a single employer. Sectoral bargaining recently received a boost from Senator Bernie Sanders of Vermont, who included it in his labor plan as part of his campaign for the Democratic presidential nomination.

Uber and Lyft said they would each give $ 30 million to support their ballot initiative. They said the initiative, which has not yet been drafted, would preserve those wage concessions.

“As a Plan B, we are reluctantly funding this initiative,” Tony West, Uber’s chief legal officer, said in an interview. “This is not our first-choice option. We would much rather have a historic deal that is good for drivers, good for innovation, good for labor.”

[Get the Bits newsletter for the latest from Silicon Valley and the technology industry.]

While officials at Lyft still believe they can reach a deal with state officials, they said they were willing to take the issue directly to voters.

“We are working on a solution that provides drivers with strong protections that include an earnings guarantee, a system of worker-directed portable benefits and first-of-its kind industrywide sectoral bargaining, without jeopardizing the flexibility drivers tell us they value so much,” said Adrian Durbin, a Lyft spokesman.

If Assembly Bill 5 becomes law, Uber will continue to litigate employment claims with its drivers, Mr. West said. “Just as we have done for the last decade, we will litigate these cases,” he said.

Let’s block ads! (Why?)

NYT > Technology

Leave a Reply

Your email address will not be published. Required fields are marked *