Emrys Yamanishi (PO ’25)
On January 1st, 2020, California’s Assembly Bill 5 went into effect. AB5 equalizes gig work—such as ride services, dog walking, and delivery—with steady work by classifying gig workers as employees. The Bill uses a three-pronged test known as the ABC test to determine whether a worker is an independent contractor or an employee. The ABC test states that A) the person is separate from the hiring organization in terms of agency at work, B) the person performs their own work that isn’t connected to the hiring organization, and C) the person is consistently engaged in independent work. AB 5 was modified slightly in September 2020 by AB 2257, which created a list of exemptions for various jobs that don’t have to follow AB 5. Notably, this list did not include ride services, such as Uber and Lyft.
Many of these ride service companies were frustrated that they were not exempt from AB 5, as they would prefer to classify their workers as independent contractors. This is likely because workers classified as employees must be given better pay and worker protection than workers classified as independent contractors. Thus having their workers classified as employees costs these companies more. In line with this frustration, Uber teamed up with Lyft to sue the state of California and lost.
However, these companies continued to push for independent contractor classification and worked together to support Proposition 22, passed in November 2020, which gives independent contractor classification (rather than employee classification) to workers for companies such as Uber and DoorDash. Similarly to AB 5, Prop 22 has faced contestation, and in the fall of 2021, Service Employees International Union filed a lawsuit against Prop 22; it was thus ruled unconstitutional as it denied California Labor Code its right to determine workers’ compensation.
Despite this ruling, Uber has continued to support Prop 22’s characteristics in the courtroom, most recently in collaboration with the delivery service company Postmates. These companies are calling for the reversal of a ruling on the 2018 case, Dynamex Operations West, Inc. v. Superior Court of L.A. Cty. ex rel. Lee., which initially created the three-pronged worker classification test. In response to this call, the 9th U.S. Circuit Court of Appeals based out of San Francisco revived Uber’s lawsuit on March 17, 2023, in a reversal of a previous decision ruled by Judge Dolly Gee.
In support of their lawsuit, Uber has cited an independent survey which found that 71% of drivers want to be independent contractors rather than employees. It is notable however that this survey was not conducted by Uber itself, but rather by Harry Campbell and his company, Ride Share Guy, which is dedicated to getting candid statements from rideshare drivers. Furthermore, this survey is not provided anywhere on the Ride Share Guy website. Both Uber and some of the responses to the survey note similar trends, however, in claiming that many workers would rather remain classified as independent contractors to maintain flexible schedules. This makes sense, given that many Uber drivers take on their positions as a part-time job in addition to a full-time job, or alongside other part-time jobs and gig work positions. A 2015 Uber-sponsored survey found that 69% of Uber drivers also had some other occupation.
However, in this same Ride Share Guy article which cites this survey, Campbell notes that many workers desire better worker protections, such as health insurance and guaranteed minimum wage. These worker protections are what AB 5 was designed to protect with the ABC test, as employee status provides these guarantees. While Campbell notes that Uber currently fails the ABC test and therefore cannot lawfully classify its workers as independent contractors on the logic of AB 5, he also pushes back on this argument that employee status would necessarily be ideal for Uber drivers. As he notes, it would still provide loopholes for Uber, as with any other employer-employee relationship.
Amongst all of this contestation of whether or not AB 5 is truly beneficial for workers, Uber continues to support Prop 22 and disavow AB 5 in the courtroom, as the state of California pushes for the opposite. From California’s point of view, AB 5 serves as a powerful example of labor law and workers’ rights protection. California Attorney General Rob Bonta in response to the Court of Appeals decision stated that the California government will continue to look into AB 5, and also continue to support legislation which protects workers. As this battle between the state and rideshare services continues, rideshare drivers themselves will continue to be held in limbo.
