With the stroke of a pen, California Governor Gavin Newsom decided the future toward transportation equity and the climate. Now, more than 800,000 Uber and Lyft drivers in the state have the power to unionize, and collectively negotiate for higher wages and better benefits. This new law is a historic victory for labor rights among gig economy workers. It’s a product of a compromise made in September between the governor, state legislators, the Service Employees International Union (SEIU), Uber, and Lyft.
In many ways, California has jumped off the deep end. It’s now the second state in the U.S. to extend unionization rights to Uber and Lyft drivers, who are considered independent contractors. Massachusetts just recently passed a grassroots, statewide ballot referendum in November, giving rights to drivers similar to those fighting for in this legislation. Similar drivers’ organizing efforts are in progress in states like Illinois and Minnesota, where drivers are fighting for the same unionization rights.
The new legislation takes place against that complicated legal backdrop. In 2019, California adopted a law that required Uber and Lyft to give drivers a minimum level of benefits. Yet voters turned down this requirement in a statewide ballot measure during the 2020 election. This spring, the California Supreme Court put its foot down. It let Uber and Lyft off the hook from having to provide drivers with the benefits of being a traditional employee.
The newly signed law does not yet cover drivers working for delivery app companies like DoorDash. This flawed decision has deepened anger from many environmental advocacy groups. Rideshare Drivers United, a Los Angeles-based democratic organization of 20,000 drivers, has been far from timid in expressing their displeasure with how well the collective bargaining law works. The coalition says that it falls short of giving workers enough tools to win the equitable contracts they deserve.
Nicole Moore, president of Rideshare Drivers United, underscored the basic obstacles drivers encounter as they go about their day-to-day work.
“Drivers really need the backing of the state to ensure that not only is a wage proposal actually going to help drivers, but that there is progress in drivers’ pay over the years.” – Nicole Moore, president of Rideshare Drivers United.
The call for stronger driver representation has been adopted by other players in the industry. Ana Barragan, a Los Angeles-based gig driver, highlighted the challenges gig workers face as a result of their employment status.
“Drivers have had no way to fight back against the gig companies taking more and more of the passenger fare, or to challenge unfair deactivations that cost us our livelihoods.” – Ana Barragan, a gig driver from Los Angeles.
The new law will significantly strengthen private sector collective bargaining rights in California. This expansion will be the largest in state history. It seeks to build a stronger framework for drivers to collectively bargain for better pay and conditions. Ramona Prieto, Uber’s California head of public policy, called the deal a product of constructive cooperation.
“Together represent a compromise that lowers costs for riders while creating stronger voices for drivers — demonstrating how industry, labor, and lawmakers can work together to deliver real solutions,” – Ramona Prieto, head of public policy for California at Uber.
Unsurprisingly, drivers’ advocates and labor groups praised the law as an important move to bring better working conditions to rideshare operators. We have yet to see how successfully it will do so and how well it will empower workers in negotiations with gig companies. The fight for equitable compensation and labor protections in the gig economy has captured national headlines.
