On Tuesday September 10, 2019, California legislators passes a landmark bill which will require app based workers (ex. Uber, Lyft, Postmates) to be treated as employees. Traditionally, these app based companies treated their workers as independent contractors. California Governor Gavin Newsom is a supporter of the bill, and is expected to sign as soon as it moves through the State Assembly. Under the law, workers are defined as employees instead of contractors if a company exerts control over how they perform their tasks or if their work is part of a company’s regular business. This law will go into effect on January 1, 2020, when signed by Governor Newsom. Experts predict around 1 million workers will be affected by the new law.
Additionally, experts are predicting that the new law will have wide-reaching implications across the country, where the workers will have more rights, but the gig businesses may change significantly. Similar measures in Oregon and Washington have been introduced, but failed to go through. New York City has a minimum wage for ride-hailing drivers (Lyft, Uber), but they do not classify the workers as employees. In Britain, Uber drivers are to be classified as employees, which means they are entitled to minimum wage and vacation.
Stay tuned as we continue to track the momentum that this bill will have across the country for workers and companies.