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James Farrar (left) and colleagues in front of the UK Supreme Court. (Photo: App Drivers & Couriers Union.)

A Victory for Gig Workers as California Rules Uber Can't Hack Labor Laws

Labor groups refused to give in after rideshare companies won an anti-worker state ballot initiative last year through a heavily funded disinformation campaign.

Bama Athreya


Gig workers have won an important victory in California's courts. On August 20, a judge ruled that a ballot initiative by Uber, Lyft, and DoorDash aimed at creating a permanent precarious workforce was unconstitutional. The decision is a major blow to the platform companies, which spent well over $200 million last year on Prop 22 to overturn a state law extending employee rights to most California gig workers.

The decision was just the latest salvo in a growing war between gig companies and the workers on their platforms.

In his ruling, Alameda County Superior Court Judge Frank Roesch protected the right of California's voters and legislators to amend their states' laws. This ruling was necessary because the companies behind Prop 22 went a bit too far; they included a clause making it impossible for California's legislature to ever amend that law.

The decision was just the latest salvo in a growing war between gig companies and the workers on their platforms. The California battle began in 2018, when a case involving delivery drivers reached the California Supreme Court. The court ruled that "on demand" drivers are employees—unless they meet a simple "ABC" test:  (A) the worker is free from the control and direction of the hirer in how they perform the work; (B) the work is outside the hiring entity's core business; and (C) the individual performing the work can demonstrate they independently perform this business for others.

Rideshare Drivers United protest, 2020. Credit: RDU.

Gig companies like Uber and DoorDash quickly understood they could prove none of these factors.  Workers are dependent on the platform for control and direction of their work. The delivery or transportation service is the gig company's main business. And most gig workers do not, in fact, have their own independent small businesses. Companies might have complied with the law, but today's prevailing corporate culture is one that rewards legal evasion. So instead they decided to dare state legislators to make them comply.

State legislators rose to the occasion, and in 2019 they passed a landmark piece of legislation, Assembly Bill 5, which codified the California Supreme Court ruling. Again, companies might have chosen to figure out how to comply. Instead they doubled down on misclassifying their workers as independent contractors, compelling California's Attorney General to bring suit against them.  Ignoring rising worker momentum, the companies hired armies of lawyers and public relations experts. They bought off civic organizations. They forced their own workers to distribute propaganda.  And they blitzed the public with their Prop 22 ballot initiative, which voters passed amid a sea of disinformation in 2020.

But worker advocates did not give up or give in—despite enormous obstacles. As Nicole Moore of Rideshare Drivers United (RDU) told me shortly after the ruling last week, the Prop 22 vote was a devastating blow to workers who were already forced to shoulder multiple burdens in the face of an ongoing pandemic.  Many were more financially vulnerable than ever.

RDU tragically lost several colleagues to Covid-19, as it was impossible to avoid exposure while driving. Yet, with allies throughout the state, they continued organizing and looking at all the possible ways they could address the existential threat of Prop 22.  The result of their continued struggle was a decision by SEIU to file a case challenging the law.

"We all signed on to the same amicus brief," Moore explained. "Labor and app-based worker groups were all on the same page: Let's overturn this horrible law. And that unity is extremely powerful."

And solidarity was not just statewide. California workers offered and took support from allies around the country and around the world. California groups were aware of an important court ruling in the United Kingdom, where a case brought by drivers had made its way to the Supreme Court. In February 2021, the UK Court ruled definitively that Uber drivers are workers and entitled to minimum wages and worker protections.

That UK victory helped drivers in other countries realize they too could fight and win. Drivers have now brought cases challenging the fiction of "independent contracting" in New Zealand, South Africa, and Australia.

Yet even in the UK, the war is far from over.

"After we won our six year epic battle against Uber, the company responded by contesting the scope of the ruling," James Farrar, one of the plaintiffs in the case and a leader in the App Drivers and Couriers' Union (ADCU), told me in an interview. "This means 40-50 percent of the true working time for UK drivers remains unpaid and unprotected. Workers are now faced with the absurd proposition that after having won a six-year battle, they must face another several years of legal battles."

For Farrar and his colleagues at ADCU, this is a good reason to keep organizing. "The lesson from this is that platform workers need to be united, resilient and resourceful," Farrar said. "They must litigate, campaign, and strike tirelessly. And since we are dealing with a global platform, we must fight in a globally coordinated way."

Together we have to fight for full labor rights for app-based workers. Because the technology is coming to every industry and it's going to be all our fight.

Moore, of the U.S.-based Rideshare Drivers United, agrees. She has already seen messages that the companies are pushing out through their apps to workers putting their own spin on the ruling and even disparaging the judge.  She believes what Uber and Lyft will do next is ignore the courts and continue appealing.

The companies will also keep fighting for more Prop 22-like legislation in other states and in other countries. Advocates predict the companies will spend more than $100 million to get a Prop 22-like ballot referendum passed in the state of Massachusetts.  Similar efforts have already succeeded in undermining gig worker rights in less rights-friendly states like Texas.

"As a labor movement, whether we are drivers, delivery people or dog walkers we have to know the only place for us to go is full labor rights," Moore said. "No matter what we're told, it's not about 'protecting our flexibility.'  Once this law was in place, the companies took away our flexibility. The only thing we can do is push for collective bargaining. We cannot be divided. Together we have to fight for full labor rights for app-based workers.  Because the technology is coming to every industry and it's going to be all our fight.  Just like we've seen in the UK, the companies haven't changed their position. There will be a lot more fights in the courts and we will need the full weight of state government and our attorney general. To have that, we need to be absolutely organized and exert our voices."

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Bama Athreya

Bama Athreya

Bama Athreya is an Economic Inequality Fellow with the Open Society Foundations.

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