Rideshare giant Uber took a confrontational position regarding California’s “gig economy” bill on Wednesday, saying its drivers can remain independent contractors.
Assembly Bill 5, which passed the state Senate on Tuesday night, codifies a state Supreme Court ruling that effectively requires most independent contractors to be reclassified as traditional shift employees.
“Contrary to some of the rhetoric we’ve heard, AB5 does not automatically reclassify any rideshare drivers from independent contractors to employees,” said Tony West, Uber’s chief legal officer, in remarks prepared for a national conference call with media.
West argued that the new bill and earlier court ruling do not apply because drivers’ work “is outside the usual course of Uber’s business, which is serving as a technology platform for several different types of digital marketplaces.”
The San Francisco-based company’s other businesses include Uber Eats, Uber Freight and self-driving cars.
West said the rideshare company would continue to respond in court to any claims of worker misclassification.
“Because we continue to believe drivers are properly classified as independent, and because we’ll continue to be responsive to what the vast majority of drivers tell us they want most—flexibility—drivers will not be automatically reclassified as employees, even after January of next year,” he said.
Lyft has taken a different position, saying that it will have to make its drivers employees and that as many as 300,000 could lose their jobs. On Wednesday, the company sent a note to drivers saying they “may soon be required to drive specific shifts, stick to specific areas, and drive for only a single platform.”
The bill, authored by San Diego Assemblymember Lorena Gonzalez, passed the state Senate on a 29-11 party-line vote and now heads to Gov. Gavin Newsom for signature.
Newsom has vowed to sign it, but also told the Wall Street Journal on Tuesday that he is continuing to negotiate with Uber and Lyft.
The two rideshare companies and DoorDash have committed to spend $90 million on a ballot measure to overturn Assembly Bill 5 in 2020.
