The Gig is Up: How Uber Drivers are Renewing Focus on Workers' Rights
In California and beyond, gig economy workers are rekindling an old labor struggle.
While 20 years ago the only people searching for "gigs" were struggling musicians, today the term "gig economy" -- also known as the sharing economy or the on-demand
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economy -- includes the world of digital freelance work powered by popular apps like Uber and Lyft.
Because they are classified as independent contractors, many gig workers are excluded from basic labor rights -- protections like minimum wage, unemployment insurance, workers compensation, and overtime pay -- that were traditionally afforded to a large portion of the American workforce. That has sizable implications for a city like Los Angeles, where approximately 23% of workers were classified as 1099 contractors as recently as 2014(up 15% from the year before). However, these protections could possibly be extended as more state legislators propose bills allowing gig workers the right to unionize.
In December 2015, Seattle became the first city to adopt legislation giving drivers at transportation network companies (TNCs, i.e. Uber, Lyft) the right to organize and collectively bargain. In a unanimous 8-0 vote, Seattle City Council approved a bill permitting full-time drivers to join representative organizations that will negotiate pay rates, worker conditions, and other concerns with employers on behalf of drivers. Now, state Assemblywoman Lorena Gonzalez (D-San Diego) is seeking to propose a similar ordinance in California as early as next month.
In the days following the Seattle City Council vote, Assemblywoman Gonzalez published an Op-ed in the Sacramento Bee announcing her plan to introduce the California 1099 Self-Organizing Act to the legislature in 2016. Although the specifics of this new legislation are still being written, it could extend the right to organize to all independent contractors utilizing a platform company to find work, not just TNC drivers. This means that home healthcare workers who are hired through an online referral service and workers for apps like Handy and TaskRabbit -- which enable consumers to outsource typical household chores as for-hire gigs -- could also gain the right to negotiate for better working conditions.
"It could include a lot of different types of jobs that are happening in the economy today," said Evan McLaughlin, Chief of Staff to Assemblywoman Gonzalez. "The economy is changing and so is the definition of work. A lot of jobs that had previously been done with employees are starting to move toward an independent contractor model. The problem is that there are a number of protections that are afforded to employees that independent contractors do not enjoy."
While there is an ongoing debate about the impact gig work is having on American employment trends, both the Seattle and California legislations indicate the nation's growing anxiety over the future of work in the US, where rapidly advancing technologies have enabled more distant employee/employer relationships. Current US labor law divides workers into "employees," who are assured certain rights by the 1935 National Labor Relations Act, and "independent contractors," who are not. As a result, workers classified as employees have been able to unionize and push for increased protections since the NLRA was originally passed. Once upon a time, independent contractors might have been more autonomous than employees, with the freedom to arrange slightly better contracts in exchange for the added risk they take on and the irregularity of service they provide. But is that still the case among today's independent contractors? And if not, what is our obligation to protect gig workers who are neither employees nor truly autonomous but fall somewhere in the murky in-between?
The Trouble with Uber
Despite the potential scope of the 1099 Self-Organizing Act, much of the debate about the nation's growing sector of gig workers has centered around one company in particular: Uber.
Based in San Francisco and founded in 2009, Uber offers consumers an on-demand ride-hailing service through its mobile app, which connects ride-seekers with Uber drivers operating their own vehicles. In a city like Los Angeles, where parking is a headache and public transportation is limited, Uber feels like a windfall to consumers who previously lacked adequate transportation options and can now move more freely around the city. In fact, that freedom is exactly what Uber's marketing scheme is largely based on -- freedom not just for Uber's passengers, but for its drivers too. "As an independent contractor with Uber, you've got the freedom and flexibility to drive whenever you have time," Uber's website claims. "No office, no boss."
But as Uber has taken off, now operating in 58 countries and 300 cities worldwide, the company's business practices have come into question, in part because of the amount of control Uber maintains over its drivers. Uber has still not built a comprehensive tipping function into its app, for instance, making it difficult for drivers to receive any tips. The company also relies heavily on a 5-star rating system that allows passengers to review their driver's performance; if drivers fall below 4.6 stars they are deactivated -- a real threat when most passengers do not understand the implications of a 3 or 4-star review. In addition, when Uber refunds a passenger who complains about a trip route or unfair surge pricing that refund comes out of the driver's fares without the need of driver approval. The company also continues to adjust its overall pricing formula without warning, slashing fares in 80 cities as recently as January 2016.
Discounted fares are good for passengers and overall company PR, but what about the drivers who depend on fares to make ends meet? Uber drivers seem to want greater jurisdiction over their fares, or at least more input. They have also expressed grievances over driver-footed gas, car maintenance, and insurance expenses and the increased risk of physical injury they face when spending all day on the road. As a result of these issues, a growing faction of dissatisfied Southern California TNC drivers has formed in the California App-Based Drivers Association (CADA). CADA was founded in the summer of 2014 with the assistance of Teamsters Local 986 in El Monte, who helped the association put together its bylaws and organizational structure. According to Joseph DeWolf-Sandoval, a member of CADA's democratically-elected Leadership Council, "The reason we got [CADA] together was because drivers had experienced a great deal of difficulty in trying to voice their concerns, specifically to Uber. Uber was not receptive to driver concerns and frankly most of the drivers were really afraid to stand up to Uber because its deactivation process is not transparent."
While it is important to note that there are plenty of TNC drivers who devote only a few hours a week to picking up fares, the drivers who maintain membership with CADA tend to depend on Uber or Lyft or a combination of TNC companies for full-time work and drive 8-10 hours per day. This is why privacy and anonymity are of major importance to CADA's members, who are concerned they could be penalized with deactivation for speaking out. "We've had several of our executive officers deactivated from Uber with little or no explanation," said DeWolf-Sandoval, including one executive member who operated an entire fleet of Uber vehicles that several drivers relied on to make fares. Nonetheless, CADA's ranks continue to grow, but with an estimated 40,000 TNC drivers operating in Los Angeles alone, it still has a long way to go. CADA currently has about 3,000 members and -- in true gig economy fashion -- does much of its organizing work online. TNC drivers connect with each other and can send messages voicing their concerns to CADA's executive members via a closed Facebook group. CADA members also participated in a global day of protest in October 2014.
"We set up this group so that drivers could come to us and explain what their major problems are, and so that we can then go to Uber or Lyft or other companies and sit down and say these are things that could be remedied," said DeWolf-Sandoval.
However, several high-level managers at Uber have informed DeWolf-Sandoval that the company does not recognize any organization claiming to speak on behalf of its drivers and it will only deal with these matters on an individual basis. CADA has so far been unsuccessful at getting Uber to sit down at the table.
21st Century Teamsters
So far CADA's complaints have fallen on deaf ears, although Lyft recently announced a partnershipwith Freelancers Union and seems to be on much better terms with its drivers overall in comparison to Uber. To be clear, CADA is not a union and, despite its affiliation with Teamsters Local 986, does not particularly aim to be one. Apart from comprehensive employee status, a traditional union would also require membership dues, which many cash-strapped drivers cannot afford. Additionally, although some Uber drivers have filed a class action lawsuit in California to be reclassified as employees, a majority of CADA's members do not actually want to forgo their status as independent contractors. "Most would like to continue to be independent contractors, but be truly independent and not under Uber's thumb so much," said CADA's DeWolf-Sandoval. "100% of our members feel that Uber exercises too much control over where they work, how they work, and what their paycheck is. They would like that to change."
Most of all, CADA would like to be heard. This is why a bill like the 1099 Self-Organizing Act could be important for CADA and other associations of TNC drivers in California. Uber, Lyft, and other gig economy companies could legally be required to hear from labor groups that represent its independent contractors.
Some critics of Seattle's new ordinance say it could be in violation of federal labor and antitrust laws and expect it to face legal challenges in the future. Seattle's Mayor Ed Murray has also declined to sign the bill. In California, Assemblywoman Lorena Gonzalez sees room for change within the "old paradigms of labor laws," which no longer adequately address the needs of workers in our changing economy; rather than regulate every single aspect of the innovative tech companies that are also rebuilding our economy, we might allow gig workers the legal right to organize and negotiate for themselves instead.
If labor is indeed changing in America, then it makes sense that the way we approach unionization might need to change too. Maybe this will provide an avenue for gig workers to gain protections that most employees enjoy, or maybe this will still not be enough. What is important to remember is that even though app companies like Uber are new, the power struggle between business and labor is an old one in the US, where corporations have typically been put first and workers second. TNC drivers and other gig economy workers are simply the latest battleground for the labor movement.
