Assembly Bill 5 by Assemblywoman Lorena Gonzalez (D-San Diego) could destroy California’s Gig economy if passed and signed into law. The Gig economy includes ride-share businesses like Uber and Lyft, and food delivery services Postmates and DoorDash.
A gig economy is a free market system in which freelance, temporary and flexible job positions are common and organizations contract with independent workers for short-term engagements. Last year, the Bureau of Labor Statistics reported that 55 million people in the U.S. are “gig workers,” which is more than 35 percent of the U.S. workforce. That number is projected to jump to 43 percent by 2020, Forbes reported.
The Service Employees International Union is pushing a separate ride-share driver bill to organize drivers, ignoring the April decision by the National Labor Relations Board and the US Department of Labor determining that that Uber drivers are independent contractors.
Gov. Gavin Newsom has thrown in his support for this takeover of independent contractors. In a recent op ed, Newsom said, “Reversing the trend of misclassification is a necessary and important step to improve the lives of working people. That’s why, this Labor Day, I am proud to be supporting Assembly Bill 5, which extends critical labor protections to more workers by curbing misclassification.”
Business industry policy experts warn that the turmoil that will be created by this decision effects virtually every industry and its freelance, flexible and independent workforce in California from beauticians to real estate agents, from construction workers to Gig workers and everything in between.
The problem is two fold: the bill is based on the legally flawed California Supreme Court Dynamex decision, and more than just Uber and Lyft would be forced to reclassify their drivers from independent contractors to employees.
Read the rest at: Misclassification
