The California Senate and Assembly have approved bill AB5, which would wage and benefit protections to those who work for app-based companies like Uber and Lyft, with a 21-14 vote in the Senate on Tuesday and 59 votes in the Assembly on Wednesday. These app-based businesses and others have vowed to fight the measure even though they are billion dollar corporations.
The senate’s vote Tuesday meant that bill will be going back to the Assembly for final approval on Wednesday. Despite staunch Republican opposition in the Assembly, the bill managed to pass on Wednesday. Now all thats left is for Governor Gavin Newsom, who has already showed his support in favor for the bill, to sign it. An estimated 400,000 Californians, who work for these app-based companies, will be affected if the bill passes.
Currently these “on-demand” workers are experiencing precarious work situations, they lack many benefits of full time employees like paid sick time and unemployment and disability insurance.
There is major pushback from these companies, mainly delivery and ride-sharing, but many Democratic hopefuls are fully behind it. However, these companies are making a lot of money off not providing their on-demand workers with benefits by saving nearly 20% of their costs by using them. However, with the looming decision many of these companies have expressed a commitment to follow the new legislation.
California Labor Union chief officer Art Pulaski wrote in a blog post on Wednesday that, “The misclassification of workers creates a corrosive effect that ripples through our entire economy, undermining our laws to protect and support working people,” he continues, “AB 5 is a powerful counter to the corporate greed and rampant exploitation that’s driving inequality across our state in emerging and traditional industries, alike.”
AB5 would put into law a California Supreme Court decision that makes it harder for companies to classify workers as independent contractors. Now instead of independent contractors, companies will have to list them as employees and provide the benefits associated with being one. One Governor Newsom signs the bill it will take effect on January 1, 2020.
