T his day, California's Governor, Gavin Newsom-a darling of tech capitalists-signed Assembly Bill 5 (AB5) into law. The bill codifies the "ABC test" to determine the applicability of California employment laws and makes it harder for companies to get away with misclassifying workers as independent contractors. If properly enforced, AB5 wants to have major impacts on vulnerable workers in the trucking, janitorial and construction industries.
But the world over, the law has been hailed as a regulatory check on the so-called "gig economy". Indeed, the International Transport Workers' Federation (a federation of 665 trade unions representing 1
AB5, however, does not reflect a strong legal shift, as its detractors have argued. Rather, the law standardizes the law for the status quo and gives more power to city attorneys to enforce laws against companies (like Uber and Lyft) who would probably have been found in violation under past precedent.
What AB5 does reflect is a profound cultural shift in regulators' relationship to and understanding of labor platforms. In the first few years of the app-lab frenzy, California's regulatory approach to gig companies could best be described as either dereliction or negligent tech-bedazzlement.
Just six years ago, state officials were enthralled by the potential of the "sharing economy "to build" community "and" trust ". In 2013, in lieu of enforcing existing taxi regulations against Uber and Lyft, the then San Francisco Mayor, Ed Lee, allowed the companies to operate illegally – even launching a "Sharing Economy Working Group" and issuing a proclamation recognizing 13 June as "Lyft Day. "
The United States Public Transportation Bureau (CPUC) has become the first state body to authorize these activities by creating a new regulatory category -" Transportation Network Companies "(TNCs ). The term is rapidly becoming the lexicon of policymakers the world over. Although it was a long time ago, the CPUC licensed the companies while remaining curiously silent on the matter of misclassification.
In the period of high unemployment after the Great Recession , the people who flocked to gig work were less interested in building community with strangers and more interested in putting food on the table. But instead of providing secure work and basic benefits like the minimum wage, overtime and workers' compensation, the gig companies joined to earlier generation of exploitative employers in their business costs and low-income "independent contractors".
Lorena Gonzalez, the author of AB5 – who attempted to introduce "The California 1099 Self-Organizing Act" in 2016 – state legislators left the glaring labor issues for the courts to figure out. As Wages Drops Again And Again Drivers Have Left To Dry By The Company, The Subtle Conditions Of Gig Work Led Workers To Sue. In response, uber and its ilk used a panoply of tactics to avoid a judgment on the
The gig companies 'intransigence, plus regulators' reticence to enforce existing laws, ultimately enabled AB5.
When Lorena Gonzalez was introduced to the bill, the California Supreme Court decision-whistle-blower was released stuck behind and held the line, pushing back against the powerful companies and their watered-down alternative proposals. Through protests, rallies and group trips to Sacramento, Labor platform workers and all those who have made the same individual rights
California legislators finally got the message: rather than feeling trust and community, many drivers face abuse from subservience to riders, but can not respond to low ratings and "deactivation". Workers are not guaranteed a minimum wage, but in one of the most dangerous occupations in the country, they do not even have basic protections like workers' compensation. The assembly speaker, Anthony Rendon, called the gig economy "feudalism all over again."
Could AB5 signal the end of technology apps operating as autonomous legal fiefdoms? The last six years have proven beyond doubt that laboratory platform companies need regulation. As we await the passage and enforcement of AB5, we should take note of the incredible shift that has taken place. California lawmakers have signaled a readiness for economic and equality, placing limits on previously unassailable tech-capital.
May the world follow.