Uber and other 3 companies pay $90 million to fight California’s new part-time law

According to foreign media reports, a group of drivers and takeaways from Uber, Lyft and DoorDash have set up a new group called Protect App-Based Drivers and Services. It aims to offset the impact of California’s recently passed zero-work law through a voting initiative.


On September 18, local time, Assembly Bill 5(AB5), signed into law by California Gov. Gavin Newsom (Democrat), set out the so-called “ABC test” to determine whether someone is a contractor or a full-time worker. Legal experts agree that the bill would make it harder for zero-hours companies such as Uber, Lyft and DoorDash to classify drivers and takeaways as independent contractors. In response, the companies say the law poses an existential threat to their business models.

So even before Newsom signed the bill into law, the companies were already preparing the contingency plan. On August 29th Uber, Lyft and DoorDash said they would spend $90 million ($30 million per company) on a voting initiative that would allow them to be almost immune from legal action.

This voting activity will require voters to agree with the following:

at least 120 per cent of the minimum wage;

$0.30/mile subsidy for costs such as petrol and vehicle wear and tear;

Under The Affordable Care Act, drivers who work 15 hours or more a week are provided with the same medical allowance as regular employees;

Provide work injury insurance;

provide motor accident and liability insurance;

Protection from discrimination and sexual harassment;

Conducting background checks on drivers;

Mandatory safety training for drivers;

Zero tolerance for alcohol and drug offences;

Set a limit on the driver’s daily working hours to prevent fatigued driving.

This is a new version of a failed proposal submitted by Uber and Lyft to California officials that would serve as a compromise to block the passage of THE AB5 bill. The companies promise to pay drivers $21 an hour, offer them sick leave and allow them to “make a collective voice” — an endorsement of their union.

But Uber and Lyft warn that drivers could lose the flexibility to drive as they please after AB5 passes. “They’re going to work shifts like every other employee,” Tony West, Uber’s general counsel, said in September. “

For Uber and Lyft, the vote is a risky and costly move because it could further infuriate unions, which have a huge influence over the passage of AB5. Unions are known to have supported the bill throughout the legislative process, while it has been at the center of a battle for part-time jobs in California.

“This is yet another brazen attempt by some of California’s wealthiest companies to avoid following the same rules as all other law-abiding companies in the state,” Art Pulaski, executive secretary and treasurer of the California Labor Federation, said in a statement. “California’s unions will come to drivers who want fair wages, better pay and flexibility as a way to thwart such a corporate ploy. “

Meanwhile, union-backed groups and other supporters of AB5 are planning to stage protests outside the homes of Uber’s key investors.


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