Bill to Allow Rideshare Drivers to Unionize Introduced In Assembly

A new bill that would allow ride-sharing app drivers to collectively bargain as independent contractors and allow unions to negotiate with rideshare companies, effectively going around the voter-passed Prop 22, was announced earlier this week.

Assembly Bill 1340, authored by Assemblywoman Buffy Wicks (D-Oakland), would specifically establish that transportation network company (TNC) drivers have the right to form, join, and participate in the activities of TNC driver organizations of their own choosing to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. The bill, also known as the Transportation Network Company Drivers Labor Relations Act, would provide that TNC drivers have the right to refuse to join or participate in the activities of TNC driver organizations. In addition, AB 1340 would require the Labor and Workforce Development Agency to enforce these provisions. Delivery drivers would also not be covered under the bill.

Essentially, the bill would attempt to get around Proposition 22, which the state and Democratic lawmakers have been challenging for years. In 2019, AB 5, a bill that severely limits Californians who work as independent contractors, was signed into law by Governor Gavin Newsom. Rideshare companies and drivers swiftly challenged the bill, and for the next year, numerous court cases were levied over it. However, those against AB 5 soon brought forth a Proposition 22, to exempt all rideshare drivers from being classified as employees. Nearly 59% of Californians voted for Prop 22 in November 2020, effectively killing a major part of AB 5.

For the next 4 years, Prop 22 was challenged in the court system, with the ordeal finally ending in July of last year when the California Supreme Court upheld Prop 22. Some Democrat lawmakers tried to find workarounds in an attempt to bring some union-based activity for rideshare drivers. This led to Assemblywoman Wicks bringing forth the bill this week.

Wicks wrote the bill as a way around Prop. 22, and for rideshare workers to be allowed to unionize.

“We stand for the right of every worker to truly have a voice,” said Wicks this week at a rally in Sacramento. “We stand for financial stability for our working class families so that folks can have food on their table, a roof over their head, and maybe even a little extra money to take those kids on vacation during spring break. We stand for the principles that all work has dignity. We stand for the right of every worker to truly have a voice.

“We’re here today to talk about respecting the voices of our rideshare drivers and offering you the choice to build power in your union. To build power for better wages, to build power for better working conditions, to build power for financial stability in your homes.”

Rideshare companies, drivers come out against AB 1340

However, like AB 5 before it, Lyft, Uber and other rideshare companies, as well as the majority of rideshare drivers, have come out against AB 1340. The companies and drivers groups noted that very few drivers would actually be able to meet the threshold of union representation because of hours worked under the bill. It was also pointed out that the majority of drivers prefer to be independent contractors and be free to work the hours that are best for them and that, if the bill is signed into law, prices would jump up for riders.

“Drivers overwhelmingly voted for and continue to support Prop. 22 because it is their preferred way to structure benefits and protections,” said Lyft Senior Manager of Policy Communications CJ Macklin to the Globe on Thursday. “And for years, we’ve been building upon this framework to roll out new products and features designed to improve the driver experience. This is the best way to balance the needs of drivers without trying to undercut the will of the voters when they originally passed Prop. 22.”

“Californians are already feeling the squeeze—and this proposal would drive up rideshare costs even more while threatening the flexible jobs thousands depend on,” added Uber Spokesman Zahid Arab to the Globe. “Drivers have been clear: they want to stay independent and keep the freedom to choose when and how they work, with access to meaningful benefits.

“According to this new statewide report, only 7% of drivers worked more than 20 hours per week and nearly 70% of drivers worked fewer than 5 hours per week, most of whom appear to be precluded from having a voice in this union process. Nearly 10 million voters overwhelmingly supported Prop 22, with 4 out of 5 drivers (82%) saying they are happy Prop 22 passed. Additionally, drivers across the political spectrum are happy about Prop 22; in fact, 85% of drivers who identify as Democrats are happy it passed. 

“Prop 22 is delivering real, measurable benefits for California’s app-based workers. Since it passed in 2020, drivers and couriers have received over a billion dollars in guaranteed earnings and benefits from Uber alone — a clear sign that the law is working as intended and making a meaningful difference in people’s lives.”

While the bill is expected to be heard in the Assembly Transportation Committee soon, it is unknown how far it will go. While AB 5 narrowly passed in 2019, both the Assembly and Senate have seen an increase in Republicans and more centrist Democrats since then. Many lawmakers may also worry about going against a voter passed initiative. And finally there is the biggest wildcard, Governor Newsom. He has been more selective in the bills he has signed in recent years, and signing one that would increase rideshare rates and go against the will of nearly 6 in 10 California voters may only further erode his popularity within the state.

“We think the right to collectively bargain around a number of issues as independent contractors is far superior to nothing,” added AB 5 author and California Labor Federation President Lorena Gonzalez on Thursday. “We are supportive of this, but it obviously is not what we had originally hoped for.”