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CA IS FORCING UBER To Make DRIVERS EMPLOYEE & UBER REFUSED, SAY DRIVER NOT IMPORTANT


 
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 6 days ago '16        #1
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CA IS FORCING UBER To Make DRIVERS EMPLOYEE & UBER REFUSED, SAY DRIVER NOT IMPORTANT
 

 

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Confusion and Defiance Follow California’s New Contractor Law

A protester at Uber’s office in San Francisco in May. The company said it would not treat drivers as employees, defying an effort in California to extend protections to independent contractors.

By Kate Conger and Noam Scheiber
Sept. 11, 2019
SAN FRANCISCO — After months of bickering over who would be covered by a landmark bill meant to protect workers, California legislators passed legislation on Wednesday that could help hundreds of thousands of independent contractors become employees and earn a minimum wage, overtime pay and other benefits.

But even before California’s governor, Gavin Newsom, had signed it into law, the battle over who would be covered flared up again. Uber, one of the main targets of the legislation, declared that the law’s key provisions would not apply to its drivers, setting off a debate that could have wide economic ramifications for businesses and workers alike in California, and potentially well beyond as lawmakers in other states seek to make similar changes.

“California sets off a chain reaction,” said Dan Ives, a managing director of equity research at Wedbush who tracks the ride-hailing industry. “The worry is that the wildfire spreads.”

In California, religious groups said they feared that small churches and synagogues would not be able to afford making pastors and rabbis employees. Winemakers and franchise owners said they were worried they could be ensnared by the law, too. Even some of the contractors for the app-based businesses that have been at the center of this debate said the change could hurt them if companies like Uber, Lyft and DoorDash decided to restrict how often they could work or cut them off entirely.

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Under the bill, workers are likely to be employees if the company directs their tasks and the work is part of the company’s main business.

California has at least one million workers who work as contractors and are likely to be affected by the measure, including nail salon workers, janitors and construction workers. Unlike contractors, employees are covered by minimum-wage and overtime laws. Businesses must also contribute to unemployment insurance and workers’ compensation funds on their employees’ behalf.

For months, lawmakers have jockeyed to exempt a variety of job categories, including doctors, insurance agents and real estate agents.

Carrying out the mandate will most likely be anything but orderly. Companies in dozens of industries must decide whether or not to comply pre-emptively or risk being sued by workers and state officials. Some workers may find that their schedules and job descriptions change, while others may be out of a job altogether if their employers cut back hiring amid rising costs.

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Mr. Newsom has said he intends to sign the bill but has indicated that he would be open to negotiating changes or exemptions with businesses like Uber and Lyft if they were willing to make other concessions. That has added to the air of uncertainty about the law.

Litigation is also likely to follow.

Uber said Wednesday that it was confident that its drivers will retain their independent status when the measure goes into effect on Jan. 1. “Several previous rulings have found that drivers’ work is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces,” said Tony West, Uber’s chief legal officer. He added that the company was “no stranger to legal battles.”

In order to classify drivers as contractors, legal experts said, Uber would also have to prove that it didn’t direct and control them, and that they typically operated an independent driving business outside their work for Uber.

Historically, if workers thought they had been misclassified as a contractor, it was up to them to f*ght the classification in court. But the bill allows cities to sue companies that don’t comply.

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San Francisco’s city attorney, Dennis Herrera, has indicated that he may take action. “Ensuring workers are treated fairly is one of the trademarks of this office,” he said in a statement.

And California may be only the beginning, as lawmakers elsewhere, including New York, move to embrace such policies. Legislators in Oregon and Washington State said they believed that California’s approval gave new momentum to similar bills that they had drafted.

“It makes everyone take notice,” said State Senator Karen Keiser of Washington, whose Legislature could take up the measure next year. “It’s not just a bright idea from left field. It gives it a seriousness and weight that is always helpful when you’re trying to pass a new law.”

While much of the debate about the California legislation has been about the impact on fast-growing businesses like Uber, Lyft and DoorDash, it could apply to many kinds of employers, including those that long predated the so-called gig economy.

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Religious groups said some congregations would struggle to pay for full employment benefits for their leaders if they were converted from independent contractors to employees.

“For smaller ones that operate on very small budgets, it could force them to lay off their rabbi or maybe only hire them part time,” said Nathan Diament, the public policy director for the Orthodox Union Advocacy Center.

Even drivers for Uber and Lyft have been split on the bill. Some of them visited lawmakers’ offices in Sacramento to plead their case for employment status. Others objected to the bill, worrying that it would take away their ability to switch their work on and off just by opening an app.

“I’m torn. Drivers are so split on the issue,” said Harry Campbell, a driver and the founder of the publication The Rideshare Guy.

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Uber and Lyft have long maintained that converting drivers to employees would most likely require the companies to schedule drivers in shifts rather than allowing them to decide when, where and how long to work. While nothing in the bill requires employees to work scheduled shifts, in practice the companies may want to restrict drivers from working when there are few customers and the revenue that drivers bring in would not offset the hourly costs of employing them.

After New York City enacted a minimum wage for drivers this year, Lyft put such restrictions in place because having too many drivers on the road without passengers could significantly raise the minimum wage the company had to pay under the city’s wage formula.

“Drivers will have some restrictions,” Mr. Campbell said. “The question for me is whether it will be worth it for all the drivers to have protections.”

The costs for app-based businesses, many of which are not profitable, could be significant. Uber held a troubled initial public offering in May and has reported large losses and slowing revenue growth. Dara Khosrowshahi, Uber’s chief executive, has laid off hundreds of employees in recent months, including Tuesday, to cut costs.

But some traditional businesses have argued that the mandate merely levels the playing field. Construction companies have long complained that they face unfair competition from rivals that classify workers as contractors so they can avoid paying payroll taxes and lowball bids on projects.

App-based companies are “starting to send carpenters, electricians, plumbers off their platform — independent contractors who make very low wages,” said Robbie Hunter, the head of the state building trades council that represents construction worker unions in California. “They’re undercutting brick-and-mortar businesses doing the right thing — paying for workers’ compensation, being very efficient, working hard to make a profit.”

In other cases, the new law has created anxiety and confusion.

Small vineyard owners are concerned that they could be forced to directly employ the independent truckers they use to haul their harvests and become responsible for providing insurance and workers’ compensation. Currently, truckers operate as contractors, with their own rigs and insurance, and serve several vineyards, said Michael Miiller, director of government relations at the California a*sociation of Winegrape Growers.

“Our members are growers, not trucking companies,” Mr. Miiller said. “The target of legislators is Uber and Lyft, but the unintended victims are small, independent vineyards on the coast of California.”



Saunda Kitchen owns a Mr. Rooter plumbing business in Sonoma County that has 30 employees, for whom she pays payroll taxes and provides the various mandated benefits. But Ms. Kitchen said she believed that she herself would have to become an employee of Mr. Rooter under the new law, which could cause the parent company to pull out of the state.

“I wouldn’t have access to new technology, training, help with marketing,” said Ms. Kitchen, who planned to talk with Mr. Rooter officials on Thursday about how to proceed.

But Steve Smith, a spokesman for the state labor federation, which advised lawmakers on the bill, said he did not believe the vineyards or Ms. Kitchen would be hurt by the law.

“We’ve seen no cases of legitimate franchisees being targeted or having any issues at all with the test” in other contexts, he said.




SACRAMENTO, Calif. (AP) — California lawmakers confronting the changing definition of work approved sweeping legislation Wednesday designed to give many contract workers new pay and benefit protections, but tech giants Uber and Lyft vowed to keep f*ghting the changes, possibly by bankrolling an expensive f*ght on the 2020 ballot.

The measure heading to Democratic Gov. Gavin Newsom outlines a three-part test that makes it harder for companies to classify workers as independent contractors who are not entitled to minimum wage and benefits like workers compensation.


Uber has argued that forcing its drivers to become employees would upend a business model that is built on flexibility. General counsel Tony West suggested to reporters that the ride-hailing company won’t start treating its workers as employees come Jan. 1, instead defending its model if it faces legal challenges.

“Just because the test is hard does not mean we will not be able to pass it,” he said.

Newsom has pledged to sign the measure, but his office hopes to bring ride-hailing and meal delivery companies to the table with labor unions to negotiate a separate set of rules for workers who pick up jobs on their own schedules in the so-called gig economy.

The freshman governor faces a test of his ability to broker a compromise between powerful interest groups in Silicon Valley and organized labor. Steve Smith of the California Labor Federation, a sponsor of the legislation, said the companies so far haven’t made acceptable proposals.

“We’re committed to creating the conditions for (negotiations) to happen,” Newsom spokesman Nathan Click said.

If Newsom signs the legislation, it could have national implications as politicians and businesses confront the shifting nature of work.

New York Gov. Andrew Cuomo, a Democrat, has indicated interest in pursuing a similar measure, and almost all the Democratic presidential contenders have offered similar proposals at the federal level.

“It’s forced the nation to take a look at what the future of work is going to look like,” Democratic a*semblyman Ian Calderon of Whittier said in supporting the bill.

The measure would enshrine in law a 2018 California Supreme Court decision that makes it harder for companies to classify workers as independent contractors instead of employees. While the court’s decision has set legal precedent since last year, the legislation provides enforcement tactics to the state and to city attorneys, who could sue companies they believe are failing to comply.


But Uber, Lyft and delivery companies such as DoorDash and Postmates aren’t ready to concede.

Uber and Lyft have already dumped $60 million into a committee for a ballot measure next year if Newsom doesn’t broker a deal. They have said the ballot measure would set a base hourly wage, give workers access to benefits they can take with them to other companies and allow drivers to collectively bargain without making them employees.

DoorDash, the meal delivery company, also has pledged $30 million.

Lyft spokesman Adrian Durbin would not comment on whether Lyft shares Uber’s position that it will not reclassify its workers come Jan. 1.

“We are fully prepared to take this issue to the voters of California to preserve the freedom and access drivers and riders want and need,” Durbin said in a statement.

The legislation is likely of intense interest to the companies’ investors — both Uber and Lyft are publicly traded. Wedbush analyst Daniel Ives wrote in a note to investors that the firm expects gig economy companies to push back and find middle ground.

The measure lays out a three-prong test to decide if workers can be labeled as contractors: The worker must be free from control of the company, perform work “outside the usual course of the hiring entity’s business” and be engaged in an independently established trade, occupation or business of the same nature of the work they are performing.

“This isn’t perfect, but I think this goes a long way to protecting workers, legitimate small businesses, legitimate businesses that play by the rules, and we, as taxpayers, that have to clean up the mess when these businesses don’t provide enough for their workers,” said the bill’s author, Democratic a*semblywoman Lorena Gonzalez, her voice shaking with emotion.

Her legislation had been the target of intense lobbying efforts, not just from gig economy companies. Because it would affect all job sectors, many have successfully pushed for exemptions.

Jobs excluded from the new test include doctors and dentists; licensed lawyers, architects, engineers and accountants; commercial fishermen; travel agents, marketing consultants, graphic designers, grant writers and others.

Critics say by writing so many exceptions, the Legislature is unfairly picking winners and losers.



Last edited by BigBallerLavar; 09-11-2019 at 10:06 PM..
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 6 days ago '16        #2
BigBallerLavar  topics gone triple plat - Number 1 spot x1 OP
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Last edited by BigBallerLavar; 09-11-2019 at 10:06 PM..
+18   

 6 days ago '15        #3
DamianDragunov 
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Yeah that’s what we need!!! More government control to keep us safe!!!!




+6   

 6 days ago '18        #4
ordoabchao  33 heat pts33
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Has to be about the taxes.
+37   

 6 days ago '14        #5
Xman0142  4 heat pts4
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Honestly. If your going to do a comprehensive crackdown on independent contractors, you have to make EVERYONE play by the rules. Don’t write exemptions for lawyers and doctors etc as they are the main ones who don’t have anything to lose. All of these professions are high earning especially when compared to drivers and carpenters. Stop with the tegulwtion and tax these companies appropriately.
+20   

 6 days ago '19        #6
ZigZag  topics gone triple plat - Number 1 spot x2
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But working for uber is like being a sub contractor. This is retarded. There no hourly wage, you work & split the pot.
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 6 days ago '19        #7
DirtyDaily 
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Anything to get them taxes
+12   

Top 10 most propped recently  6 days ago '19        #8
Big Tymerz  topics gone triple plat - Number 1 spot x2
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 6 days ago '16        #9
OWPE  111 heat pts111
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California is the dumbest state in America. This won't help anybody.

+8   

 6 days ago '08        #10
Kewop Decam  100 heat pts100
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 ZigZag said
But working for uber is like being a sub contractor. This is retarded. There no hourly wage, you work & split the pot.
Not exactly... because with Uber, EVERY person is a contract worker and with contract workers every state there are rules. Like in Florida, someone can't contract you for longer than like 6 months. There are loopholes, but those rules Uber doesn't follow. You can be "contract" for life and that can be highly abused.
+8   

 6 days ago '10        #11
SmoothTay  23 heat pts23
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fu*k uber
+16   

 6 days ago '19        #12
PRo 
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Makes sense, they went public and made b's
And also, they're in logistics with uber freight. The greedy fu*ks probably think that the driver's (aka the ppl that got them where they are) are their biggest liability, and they're probably right
+2   

 6 days ago '11        #13
DRAGONFLY JONES  132 heat pts132
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 ordoabchao said
Has to be about the taxes.
Taxes and insurance
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 6 days ago '19        #14
SlimKenobi 
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What's up with the title tho my n*gga are you Asian?

+26   

 6 days ago '16        #15
Blackout75 
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 Xman0142 said
Dont write exemptions for lawyers and doctors etc as they are the main ones who dont have anything to lose. All of these professions are high earning especially when compared to drivers and carpenters. Stop with the tegulwtion and tax these companies appropriately.
I can't speak on lawyers, but doctors are taxed and regulated out the a*s, AND they gave a lot to lose. You have any idea how much malpractice insurance costs? And if they don't get it they either can't get a job or are gambling with their entire career if a mistake happens or they get caught up in some legal bs. Or how much it costs to go to college + med school with no guarantee you'll make it through to be able to pay those loans off? There's doctors making good money just to be living normal cause they have so many loans to pay off. I don't know where you get the idea that they get off easy with regulations and taxes
+9   

 6 days ago '17        #16
Imissmalcolmx17  1 heat pts1
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 SlimKenobi said
What's up with the title tho my n*gga are you Asian?



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 6 days ago '04        #17
eazyvaboy  80 heat pts80
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A 10 minute Uber ride in Cali bout to be $70.

Yall bout to be walkin.
+19   

 6 days ago '17        #18
TheGreyOne 
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 eazyvaboy said
A 10 minute Uber ride in Cali bout to be $70.

Yall bout to be walkin.
This. California about to slay it's golden egg laying geese. That's what all these high tax states actually bank on; that a company's greed will keep them there and in operation no matter what the state demands- so long as the company is making money.

But in this case anyone with sense (so this does not include CA pols) knows to comply here would sink Uber. The state wants those tax dollars the independent contractors aren't paying when they massage their income and max out expenses. Fukouttahere with that "protections for workers" bullsh*t. The majority of drivers are cool with the situation and all willingly signed up for it.

Uber about to be out of California within 3yrs and all those drivers out of work. This was likely pushed by the taxi cab lobby who are some powerful and corrupt muthafu*kas. Basically the mob.
+5   

 6 days ago '05        #19
Woodwin  4 heat pts4
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Lmao I’d pull uber from the entire state then fu*k them, sh*t is really sub contracting honestly. All them drivers gone be screaming then
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 6 days ago '17        #20
2007  2 heat pts2
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Business is not fair. Hate uber? Go to lyft
+4   

 6 days ago '05        #21
pnoi89  18 heat pts18
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 Woodwin said
Lmao Id pull uber from the entire state then fu*k them, sh*t is really sub contracting honestly. All them drivers gone be screaming then
The majority of those Uber and Lyft drivers have nooooo idea what it means to be a 1099 independent contractor, so these THINK themselves as a W2 employee because thats all they know.
+9   

 6 days ago '04        #22
eazyvaboy  80 heat pts80
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 TheGreyOne said
This. California about to slay it's golden egg laying geese. That's what all these high tax states actually bank on; that a company's greed will keep them there and in operation no matter what the state demands- so long as the company is making money.

But in this case anyone with sense (so this does not include CA pols) knows to comply here would sink Uber. The state wants those tax dollars the independent contractors aren't paying when they massage their income and max out expenses. Fukouttahere with that "protections for workers" bullsh*t. The majority of drivers are cool with the situation and all willingly signed up for it.

Uber about to be out of California within 3yrs and all those drivers out of work. This was likely pushed by the taxi cab lobby who are some powerful and corrupt muthafu*kas. Basically the mob.
Bruh, you nailed this sh!t exactly. This is all about tax revenue but it is hypocritical because it is obvious they are targeting Uber. This is the same as I am seeing in my town now cooking up Air B&B taxes for muhhfu*kas who rent their house out for a few weeks here and there.

Crazy.
+2   

 6 days ago '04        #23
eazyvaboy  80 heat pts80
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 2007 said
Business is not fair. Hate uber? Go to lyft
Bruh, the same exact policy will apply to Lyft as well?
+4   

 6 days ago '17        #24
2007  2 heat pts2
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 eazyvaboy said
Bruh, the same exact policy will apply to Lyft as well?
And taxi.. People who complain are never satisfied!
+4   

 6 days ago '11        #25
QuietPack  1 heat pts1
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Uber takes a huge chunk, of the ride fare . And is somehow losing money!
+6   



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