Ride-hailing companies like Uber and Lyft provide an excellent source of supplemental income for people who are looking to make a few bucks on the side. For others, the driving gig is their sole source of income either by choice or because they’re unable to find more lucrative work.
However, gig workers like the drivers who operate under the umbrella of companies like Uber and Lyft are currently considered independent contractors in California (and most of the rest of the country). The companies say that this is necessary in order to maintain profitability — and also a huge benefit to the drivers. Their independent contractor status allows them freedoms that regular employees don’t have. The companies say that those freedoms — like the ability to choose their own working hours — would vanish if the drivers were re-classified as employees under new laws.
Assembly Bill 5, which would give gig-work drivers bargaining rights and the right to employment benefits like insurance, could radically change things for these companies and their drivers — and the bill is close to passing. It’s already gone through the state assembly and is waiting on a Senate vote now. If it passes, the new language of the law would make it just about impossible for Uber and Lyft to classify their drivers as independent contractors.
While the companies acknowledge that some reforms may be necessary to protect its drivers, they say that the two-category system of employee versus independent contractor isn’t reflective of modern times. Their drivers, they argue, are essentially somewhere in between — deserving of benefits and protections without necessarily being deemed actual employees.
The fight over how to classify workers is a growing issue in an economy where “gig work” is more common than ever and has massive implications for other workers (and companies) outside of the ride-sharing industry. There’s already a lot of confusion over what makes someone an employee instead of independent contractor — and a lot rides on which category you fall into.
If you believe that you’ve been unfairly denied employment benefits after being wrongly classified as an independent contractor by an employer, find out more about your rights and options today.