- Uber, Lyft Drivers Could Form Unions Under New York Proposal
- Beyond ‘Dependent Worker’
- ‘Work in Progress’
- Eye on Washington
- Most Expensive Ballot Initiative in California History Pits Uber and Lyft Against Drivers Who Built a Union from Scratch
- GRASSROOTS ORIGINS
- ORGANIZING ON A SHOESTRING
- A GLOBAL STRIKE
- CALIFORNIA’S GAME-CHANGING LAW
.3 BILLION IN WAGE CLAIMS
- THE CORPORATE COUNTERATTACK
Uber, Lyft Drivers Could Form Unions Under New York Proposal
New York lawmakers are planning to introduce a bill that would go beyond making Uber Technologies Inc. and Lyft Inc. drivers employees by also allowing them to unionize, a move that could clash with federal labor and antitrust laws.
“There’s no scenario I can imagine that’s not going to include collective bargaining,” said Sen. Diane Savino (D), adding that she and Assemblyman Marcos Crespo (D) plan to introduce the legislation after lawmakers return to Albany in January.
“New York is a solidly union town, and I am a solidly union senator,” Savino said, adding that legislation that doesn’t include collective bargaining is “an absolute nonstarter.”
Uber and Lyft already are fighting a multifront battle over their business models that treat drivers as independent contractors instead of employees.
That includes class actions in at least three states alleging the companies have misclassified drivers, a $650 million New Jersey employment tax bill for Uber, and an ongoing lobbying war against a new California law designed to make it harder for companies to classify workers as contractors.
Workers as independent contractors are treated as self-employed entrepreneurs who aren’t covered by minimum wage and overtime pay requirements and don’t get unemployment insurance and workers’ compensation benefits. And because collective bargaining among individual business owners is a form of illegal price fixing, organizing unions also is problematic under federal antitrust law.
Gig companies have posed new laws as threats to the flexible arrangements they offer workers, who largely have the ability to work when and where they want. Roughly 90% of Lyft drivers work less than 20 hours per week to supplement income from other jobs, according to the company.
“These are parents who have busy schedules, retirees, and students,” Lyft spokesman C.J. Macklin told Bloomberg Law. “Many turn to driving because traditional employment simply doesn’t fit their needs.
That’s why we are advocating for solutions that expand the benefits and protections they already enjoy in New York, while still preserving the flexibility and upward earning potential they value so much.
Lyft, Uber and other companies have floated some sort of sectorwide bargaining as part of a deal to avoid reclassifying drivers in California. But having union rights enshrined in state law would give drivers and other gig workers more leverage at the bargaining table. That’s why the move is ly to be challenged in court.
“There are a lot of companies that provide income for a lot of people where this would destroy their business model,” Frank Kerbein, the head of human resources policy for the Business Council of New York State, told Bloomberg Law. “Someone will take legal action to stop that.”
Kerbein nonetheless said he expects the measure would become law assuming it wins support from Gov. Andrew Cuomo (D), who hasn’t yet taken a position.
“I think the governor will look forward to getting a ‘best in the nation’ headline. I think it’s pretty clear that this is a priority for a lot of the people he aligns with.”
Beyond ‘Dependent Worker’
Savino and Crespo in June sponsored a bill (S.6538/A.8343) that would have created a new “dependent worker” classification and required the state labor department to study potentially giving those workers certain rights.
That bill died but Savino, who chairs the Senate’s Committee on Internet and Technology, and Crespo, who chairs the Assembly’s labor committee, said their new idea has momentum because of the passage of the California law, the New Jersey case and other recent events. It also is ly to get the blessing of some of the state’s top unions and other worker rights groups.
The new legislation could involve some version of the “ABC” test that states California, New Jersey, and Massachusetts use to distinguish between contractors and employees. Those tests make it harder to classify workers as contractors than the standards used in other states and under federal law.
“We will probably move in a different direction from the dependent worker classification that we had drafted,” Crespo said. “We’re trying to see if there’s a way to come up with a more workable ABC model that would sort of meet our state standards and the fact that we do have, in labor law here, collective bargaining.”
The state Assembly labor committee is expected to host a public hearing Dec. 5 in Albany on proposed changes to the status of independent gig workers, Crespo said. There was a Senate hearing Oct. 16.
‘Work in Progress’
A federal judge in Washington state in 2017 struck down a Seattle ordinance that would have allowed Uber and Lyft drivers to organize despite their independent-contractor status. The U.S Court of Appeals for the Ninth Circuit last year affirmed that decision, finding that the local ordinance wasn’t exempted from federal antitrust law.
“The Ninth Circuit decision suggested that a collective bargaining law at the municipal level would run into problems, but it left open the possibility for doing it at the state level,” said Charlotte Garden, a professor at the Seattle University School of Law.
Worker advocates say a New York law, if crafted correctly, could qualify for a “state action” exemption to the antitrust restrictions. New York already has a state labor-relations law in place, they point out, and the government has a strong interest in regulating in this space.
“There are some legal exemption issues, but the framework exists,” said Bhairavi Desai, who runs the New York Taxi Workers Alliance. The alliance is part of a coalition of worker rights groups, including the National Employment Law Project and Service Employees International Union 32BJ, lobbying for legislation similar to the new California law.
Eye on Washington
The National Labor Relations Act largely preempts state and local governments from enacting their own labor-relations laws and the National Labor Relations Board, which enforces the law, hasn’t been shy about protecting its turf.
The agency sued Arizona in 2011 to block a state law it said would require workers to use secret ballot elections to recognize a union. The NLRB’s then-general counsel also sent letters to attorneys general in three other states where voters had endorsed similar measures.
“The board has taken up cases where states have encroached on the board’s authority,” said Glenn Spencer, a labor and employment policy lobbyist for the U.S. Chamber of Commerce. “I’m pretty certain that it would get challenged and that they would lose.”
The NLRB’s current general counsel said in a memo published earlier this year that Uber drivers aren’t covered by the federal labor law.
Worker advocates in New York say that opens the door to extending union rights to gig workers under state law.
But they also may run into a 1976 Supreme Court decision striking down a Wisconsin law protecting certain union pressure tactics, in which the justices said that Congress meant to leave some areas of labor relations unregulated.
“The memo does not mean the state would not be preempted,” an NLRB official told Bloomberg Law. The official, who said he was not authorized to comment publicly because the issue could come before the agency, cited the Supreme Court ruling in the Wisconsin case.
The board and its lawyers have been known to change their minds, especially after control shifts from one political party to another.
If a new, Democrat-nominated general counsel were to later decide that gig workers are covered by the law, that would ly spark new preemption questions.
The NLRB has gone back and forth during the Trump and Obama administrations over whether Uber drivers, Handy home cleaners, and other workers connected to customers through online platforms are covered by federal collective bargaining law.
All that leaves the question of whether drivers would unionize if given the chance.
Raymond Reyes, who has been driving in the Philadelphia area for Uber for five years, said he’s had some initial discussions with local unions about organizing drivers. “With a union, at least you can stop the downward spiral. The biggest things drivers need is due process when it comes to rider complaints and safety protections,” he said.
Still, he said, “A lot of people still want to be independent contractors.”
Most Expensive Ballot Initiative in California History Pits Uber and Lyft Against Drivers Who Built a Union from Scratch
During this election cycle, companies Uber, Lyft, and Doordash—the so-called “gig economy” giants—have spent a record-breaking $200 million to pass Proposition 22 in California. The proposition would exempt these companies from basic labor law.
While the initiative is opposed by the California Federation of Labor and many Democratic elected officials, its fiercest adversary is a little-known “start-up” union, Rideshare Drivers United.
RDU, formed three years ago, has grown to 19,000 members. Its organizing model relies on new technologies, support from unions and nonprofits, and most importantly, strong relationships among workers.
It’s about “drivers talking to drivers and saying it’s time to move,” said part-time driver Nicole Moore.
Rideshare Drivers United emerged grassroots protests in August 2017 against the lower-than-minimum wage paid by Uber and Lyft to drivers at LAX Airport.
Esterphanie St. Juste, one of the founding members of RDU, had been driving since 2015—and protesting almost as long. “I was in so many organizations, but none of them ever took off,” St. Juste said.
But things began to change when drivers were asked to wait for passengers in queue in a lot outside the airport. “We had an opportunity to meet other drivers for the first time,” St. Juste said. “We would stand there for hours waiting, and we had a chance to talk. We started realizing they were taking more than 20 or 25 percent of the fare.”
They formed “a ragtag group of drivers,” St. Juste said, “pissed off and irritated.” They sent letters to Lyft and Uber and learned that the companies had changed their contracts, which the drivers were compelled to sign by accepting the terms and conditions of the apps.
Around this time the drivers met an East Hollywood app developer named Ivan Pardo. For years, Pardo had wanted to build an app that would help drivers organize strikes. But he also realized that “an app alone wouldn’t solve anything, and that a democratic, driver-led organization was needed.”
Pardo heard about the LAX protests and started volunteering with RDU. When he met St. Juste and other drivers, he saw that the movement had legs.
“Esterphanie had an understanding that this would be a big battleground for workers in the coming years,” said Pardo. “There was a conviction that this needs to be fixed or else there would be horrendous consequences for workers in all industries.”
RDU held more protests and continued to organize at the LAX rideshare lot. It found support and meeting space from local labor institutions—the Los Angeles Federation of Labor, the Los Angeles Alliance for a New Economy, and the UCLA Labor Center. In a year it grew to 1,000 members.
ORGANIZING ON A SHOESTRING
Much of the labor movement has been reluctant to organize gig workers because, under law, they did not seem to have collective bargaining rights. The apps typically treat drivers as independent contractors.
Around the country, the Teamsters and Service Employees (SEIU) have backed efforts to improve drivers’ pay and standards without fighting for employee status or collective bargaining. In New York, the Machinists actually formed a partnership with Uber, called the Independent Drivers Guild (IDG).
In California, however, the court system helped rideshare drivers and other gig workers clear a major hurdle when the state Supreme Court handed down its 2018 Dynamex ruling, laying out clear standards that would have to be met to classify workers as independent contractors. Uber and Lyft drivers were entitled to employee rights.
With the law on its side—and a bit of ingenuity—RDU demonstrated that gig workers could be organized on a shoestring budget.
A $4,000 grant paid for ads that brought drivers to RDU’s website, where they could become members, participate in surveys, and most important, schedule a call with a volunteer organizer.
Through Pardo’s app, organizers talked with drivers, identified potential leaders, and began to build an organizing committee in Los Angeles, then nascent branches in San Diego and San Francisco.
“The more you talk to other drivers,” said driver Tyler Sandness, “the more you realize that every driver has the same problems—problems with pay, problems with deactivation. All these frustrations are shared by the entire workforce.”
A GLOBAL STRIKE
But while drivers were building their own organization, reports emerged that newly elected Governor Gavin Newsom was negotiating with Uber, Lyft and other unions in California to broker a deal similar to the IDG in New York.
RDU held a protest in downtown L.A. calling on Newsom to stand up for the principles that members had voted for in their Drivers’ Bill of Rights: fair pay, transparency, a voice on the job, and community standards.
Then last year, to impress Wall Street in advance of their Initial Public Offerings (IPO), Uber and Lyft cut drivers’ pay rates dramatically. Uber noted in its S-1 filing with the Securities and Exchange Commission that it could expect “driver dissatisfaction” to increase.
RDU organizers met immediately to determine their strategy. Drivers decided to strike against both companies on March 25, 2019, for 25 hours, in protest of the 25 percent wage cut.
They would hold a five-hour picket outside of Uber’s Greenlight Hub in Redondo Beach.
During 10 days of phone banking, no drivers voiced opposition, and virtually all committed to turning off their apps for the day.
Although the companies did not concede to RDU’s demands—and there was little expectation they would—the strike contributed to a sluggish IPO for Lyft and generated significant media attention. The Guardian, Los Angeles Times, Washington Post and ABC News carried the story. RDU grew from 3,500 to 4,700 members in one month.
The buzz also spread throughout the country. “We heard specifically from at least two other driver groups,” Moore said: “‘If you go on strike, let us know when, and we’ll go with you.’”
RDU determined to lead a national day of action on May 8, the eve of Uber’s IPO. Drivers in at least 10 U.S. cities—including San Francisco, San Diego, New York, D.C., Philadelphia, and Chicago—participated.
A member of the New York Taxi Workers Alliance, one of RDU’s strongest allies, worked to get the support of international organizations; ultimately drivers on five continents struck against Uber.
Presidential candidates Biden, Sanders, Warren, Harris, and Buttigieg tweeted their support.
RDU had helped elevate the conditions of gig work to a major political issue—not just in California, but throughout the U.S. and around the world.
CALIFORNIA’S GAME-CHANGING LAW
With workers mobilized, progressive state legislators introduced Assembly Bill 5, which was designed to write the Dynamex ruling into statute.
Now other unions saw the possibility that rideshare drivers could win employee status and collective bargaining rights—and started paying closer attention.
Eric Dryburgh, then an organizer with the Transport Workers Union, called his organizing director as soon as he learned about AB 5. “I thought, ‘We can’t not do this,’” Dryburgh said. “This is a really, really important fight.” So TWU partnered with RDU.
Dryburgh was impressed with the organization that the drivers had built. “They had a good system. I didn’t really need to mess with much,” he said. But he guided the drivers in how to “scale up, take the vision and put it into action.”
Sandness, who became a full-time organizer, was excited to lead the lobbying effort and meet with lawmakers for the first time. “I have a bit of a ‘Mr. Smith Goes to Washington’ streak in me,” he said.
As more elected officials came out in support of AB 5, Governor Newsom—who has long-standing ties to Silicon Valley—ultimately voiced his support in a Labor Day op-ed in the Sacramento Bee. The bill passed both legislative houses and was signed into law last fall, set to go into effect on January 1, 2020.
“Seeing AB 5 pass,” said Sandness, “it seems the winds are turning.”
But immediately Uber and Lyft were taking legal action to try to earn exemption from the law. And one month later they filed a ballot initiative—what would become Prop. 22—to rewrite the law altogether.
$1.3 BILLION IN WAGE CLAIMS
RDU launched its “People’s Enforcement of AB 5” campaign on March 25, one year after its first strike. Pardo had designed a new online tool to assist drivers in filing wage-and-hour claims with the California Labor Commission.
Over the next months, the organization showed drivers how much money they were being cheated through misclassification. “It gave people a thing to do that wasn’t just striking,” said Dryburgh.
The COVID-19 crisis made driving unsafe and brought demand to a standstill. RDU helped ensure that drivers wouldn’t fall through the cracks. “We assisted hundreds if not thousands of drivers in navigating through the unemployment process,” said Sandness, “and helped people get not only pandemic assistance, but in some cases actual unemployment insurance.”
In May, Attorney General Xavier Becerra and the city attorneys of Los Angeles, San Francisco, and San Diego filed suit against Uber and Lyft, demanding that they comply with AB 5. In August, when 5,000 drivers had filed a total of $1.3 billion in wage claims and damages, the Labor Commission itself filed suit against the two companies—an unusual move.
Two weeks later, a judge ruled in the state’s favor and enjoined the companies to properly classify drivers as employees. “It was a ‘pinch yourself’ kind of moment,” said Moore.
With the vote on Prop. 22 just two months away, the fate of rideshare drivers now lay in the hands of voters.
THE CORPORATE COUNTERATTACK
The California Labor Federation and many unions prioritized defeating Prop 22. RDU began working closely with TWU, SEIU, the Food and Commercial Workers, and the Teamsters to stave it off, battling a barrage of propaganda from the gig companies.
The big unions have contributed essential resources, while RDU brings the worker voices, said Dryburgh, who now works directly for RDU.
The #NoOnProp22 Campaign has used Zoom rallies, caravans, and worker-produced online videos. Through the campaign season, growing numbers of drivers participated in phone and text banking sessions. By November 2, RDU members had contacted 1 million voters.
“We’re up against the most expensive ballot initiative in the history of California, the history of the United States,” said Sandness, “and we’re going toe to toe with them. The door is just going to be open to us to get even more, and hopefully create the first gig economy union in the U.S.”
“To beat the tech companies and change the scales so that drivers have something with real teeth, you’re going to need a really strong union to do that,” said Dryburgh. “And the only way you are going to have a union strong enough to do that is one built RDU. It has to come from the drivers.”
Brian Dolber is an assistant professor of communication at California State University, San Marcos, and an organizer with Rideshare Drivers United.