Connect with us

Companies

Uber and Postmates sue to block California law protecting gig workers – People’s World

Published

on

Uber and Postmates sue to block California law protecting gig workers

In this Aug. 28, 2019 file photo, supporters of AB5, a measure to limit when companies can label workers as independent contractors, circle the Capitol during a rally in Sacramento, Calif. Gov. Gavin Newsom signed a measure, which took effect at the beginning of this year, making it harder for industries to treat workers like contractors instead of employees who are entitled to minimum wage and other benefits. Gig firms Google and Postmates are suing to overturn the law. | Rich Pedroncelli / AP

SACRAMENTO (PAI)—Two big “gig economy” firms, “ride share” giant Uber and the courier company Postmates, are battling California’s new labor-backed law banning the company misclassification of workers, especially Uber and Lyft drivers and other “gig” workers, as “independent contractors.”

And Democratic Gov. Gavin Newsom, the state AFL-CIO, pro-worker groups, state Attorney General Xavier Becerra (D) and sponsoring State Rep. Lorena Gonzalez, D-San Diego, are girding for the coming conflict in federal court—and in the battle for public opinion.

Uber and Lyft tried all they could to stop Gonzalez’s bill, AB5, before lawmakers passed it and Newsom signed it on Sept. 18. It targets worker misclassification in general and gig economy worker misclassification in particular. They failed.

Now Uber and Postmates have sued in federal court to stop it.

“One clear thing we know about Uber is they’ll do anything to try to exempt themselves from state regulations that make us all safer and their driver employees self-sufficient,” Gonzalez tweeted Dec 31. Uber alone has been hit with 38 lawsuits from its exploited workers.

Misclassification smashes the rights and the incomes of a million workers in California alone, including the Uber and Lyft drivers, port truckers in Los Angeles-Long Beach whom the Teamsters have tried to organize for years, and warehouse workers in what Californians call The Inland Empire. It’s also rife elsewhere. Other cities and states, led by Seattle, also outlaw management misclassification. GOP President Donald Trump’s NLRB, though, is for it.

As “independent contractors,” misclassified workers lack virtually all labor law protection. Not only are they barred from unionizing, but also must pay their own and the employers’ shares of Medicare and Social Security payroll taxes, workers’ comp and often even their own gas, insurance, and supplies.

“Gig economy” workers misclassified as “independent contractors” have had to sue “gig” firms. Rebecca Smith of the National Employment Law Project says eight big “gig economy” firms, including Uber, Postmates, Lyft and Amazon, face more than 70 suits combined.

And that doesn’t count the long-running battle in Los Angeles-Long Beach, where the Teamsters have repeatedly called in the state Labor Department against the port trucking firms’ misclassification of truckers as independent contractors. The state, the port truckers, and the Teamsters have won every time against at least four big trucking companies.

Smith says the misclassified gig economy workers’ lawsuits “cover underpayment of wages, tip-stealing, unfair shifting of business costs onto workers, discrimination, and unfair labor practices meant to keep workers from joining together to improve conditions. Plainly, these workers are not happy with the status quo.”

AB5 turns all that upside down. It calls those workers “employees,” organizable under labor law, and covered by other worker protections. That led to the lawsuit in federal court to overturn the new state law. The gig firms want to save money on pay, payroll taxes, workers’ comp, and to thus cut their rates and increase their profits, Gonzalez says.

“More than a million Californians have been misclassified by employers looking to cut costs at the expense of workers. Companies relying on this illegal business model decimate the state’s worker safety-net programs, undermine fair competition, and subject law-abiding businesses to unfair competition,” Gonzalez explains.

“Ultimately, when workers without protections are laid off or cannot find work, get sick or injured on the job, or they retire, taxpayers end up bearing the costs of supporting them…. By applying a strict test to determine who is an independent contractor and making ‘employee’ status a default under the law, working Californians who have been kept off payroll as employees will gain access to basic labor rights for the first time.”

The benefits include “rights to minimum wage, overtime, unemployment insurance, workers’ compensation, paid sick days, paid family leave, workplace protections against harassment and retaliation, and the right to form or join a union. Some of the many workers who will benefit include janitorial workers, construction workers, port truck drivers, home health aides, hotel and hospitality workers, delivery and ride-hail drivers,” she said. The “ride-hail drivers” are the Uber and Lyft workers.

The California AFL-CIO campaigned strongly for AB5, along with allied unions and community groups. At its 2019 convention, the national AFL-CIO denounced the gig firms’ exploitation. The state fed will defend California’s law, too, Executive Secretary-Treasurer Art Pulaski said on New Year’s Eve.

“AB5 is the most important state law in decades to address widespread inequality by raising wages for workers and holding corporations accountable,” Pulaski said. He called the suit against AB5 “completely without merit and shows how little these massive tech companies care about their own workforce or workers in other industries who stand to benefit from AB5.”

“Gig companies built entire business models on the pernicious practice of misclassification. Instead of recognizing their drivers as partners in the companies’ success and providing a fair wage and basic protections like workers’ compensation if injured on the job, paid sick days and family leave, these companies deny workers what they deserve under the law.”

“The California labor movement will fight against these disingenuous efforts to overturn AB5 and roll back workers’ rights…. We’re not about to allow greedy corporations to flout the law or delay its implementation with meritless lawsuits.”

Of course, Donald Trump’s National Labor Relations Board’s top enforcement official, the general counsel, sides with Uber, Postmates, Lyft, and other gig firms and against the workers. Larry Mishel of the Economic Policy Institute spotlighted the GC’s internal memo, which told staffers to consider gig workers as “independent contractors,” in September.

Mishel said the NLRB’s general counsel “either ignores, dismisses, or misstates the realities Uber drivers face, in order to wrongly conclude they are independent contractors.” Misclassifying them “robs Uber drivers and similar workers of the rights afforded to them by the National Labor Relations Act to engage in collective action—like collective bargaining—to improve their working conditions.”


CONTRIBUTOR

Mark Gruenberg




Source link

Companies

Real-time payments are changing gig-economy, real estate payments at small banks

Published

on

By

Two smaller banks with strikingly different roots — a startup financial institution in Irvine, Calif., and a century-old Missouri-based bank — are seeing similar trends emerge around demand for real-time payments.

Newer real estate and gig economy companies are most interested in real-time payments, while traditional corporations take a bit longer to explore use cases, according to two banks that were among the first to adopt RTP through FIS’ banking platform.

Data about faster payments demand and usage at small and midsize banks is trickling in as FIS completes the first phase of RTP implementations via The Clearing House (TCH) network, three years after the nation’s largest banks (which collectively own TCH) launched the service.

Smaller financial institutions uninterested in RTP may wait up to three or four years for the Federal Reserve’s proposed FedNow instant-payments solution to launch, and neither Nano Banc nor First Bank wanted to wait that long.

Jacksonville, Fla.-based FIS last year began exploring RTP rollouts with interested institutions, with implementations occurring over a couple of months during the pandemic, FIS said.

Nano Banc and First Bank recently went live with RTP for receiving payments, with plans to add sending capabilities in the next few months, as they explore marketing and pricing for the new payments services.

First Bank, based in the St. Louis, Mo., serves a lot of small businesses and family-owned firms in the Midwest and California. The bank launched RTP in July and saw immediate interest from its B2B customers looking to pay Grubhub drivers and other gig-economy workers, said Ajay Kothuri, First Bank’s assistant vice president.

“Most of our first RTP use cases are companies who want to get payments to workers and suppliers faster,” Kothuri said.

Several businesses that adopted RTP are pleased with its speed and the inclusion of pertinent remittance information for streamlined accounting, Kothuri said.

“We’re already seeing interest in RTP spread from B2B to B2C, and in coming months we’ll expand applications so end users can bring RTP to existing ACH and card payments,” Kothuri said.

First Bank has not changed its pricing for RTP payments.

“As we expand RTP and begin sending ACH and wire payments, we’ll look at products and pricing,” he said.

First Bank is unrelated to FirstBank, the Colorado institution that was the first non-founding member of the P2P network Zelle (formerly clearXchange) to sign on to that project.

California’s Nano Banc was the 44thbank out of 18,000 to launch RTP when the service went live in August, said Mark Troncale, the bank’s co-founder and president.

Real estate companies have been the most enthusiastic participants in RTP since the launch, with faster payments speeding up deals and payouts to real estate agents, according to Troncale.

“We see application in the real estate settlement industry, where agents like to get their commissions very fast and settlement and fiduciary companies like to go past the traditional transaction cutoff time if they can,” Troncale said.

Nano Banc’s current ceiling for receiving payments via RTP is $100,000, which restricts the network’s use for certain higher-ticket real estate deals, but Troncale sees that as a short-term obstacle.

“Eventually we’ll get to the place where we can do larger amounts, and in the real estate industry specifically we see great value with RTP,” he said.

Most of Nano Banc’s customers are local, but the bank also serves some national companies and Troncale expects RTP will help Nano Banc compete more effectively across the U.S.

“I think my competitors in the community bank space will start to adopt RTP very quickly, once they see its advantages,” he said.

Nano Bank is still contemplating how it will price RTP as it expands.

“There’s been lots of talk about how this will be a new, cheaper solution with payment gateways, but you get what you pay for,” he said. “I don’t know if our RTP will be cheaper than other options but it’s going to add so much more in terms of security and efficiencies … pricing will be competitive but we’re still exploring what that’s going to look like.”



Source link

Continue Reading

Companies

It is a ballot fight for survival for gig companies like Uber, DoorDash

Published

on

By

By Kate Conger

OAKLAND: By late August, the urgency was becoming clear. Top executives of Uber, Lyft and the delivery service DoorDash met to discuss a California ballot measure that would exempt them from a new state labor law and save their companies hundreds of millions of dollars.

The survival of their businesses was on the ballot.

Days later, political strategists responded to the executives’ concerns by telling the companies, which had already pledged $90 million to back the measure, that they needed to spend a lot more if they wanted to win, said three people familiar with the discussions, who were not allowed to talk about them publicly.

The fight over the ballot measure, Proposition 22, has become the most expensive in the state’s history since then, with its backers contributing nearly $200 million and 10 days still to go until the Nov. 3 election. Along the way, the companies have repeatedly been accused of heavy-handed tactics; a lawsuit filed Thursday claims Uber is coercing the support of its drivers.

Despite the big spending and a barrage of television advertising, only 39% of likely voters said they supported Uber and Lyft in a poll last month by the University of California, Berkeley, while 36% opposed their proposal and others were undecided. People close to the campaign said they would want to see close to 60% approval in polling before they could breathe a sigh of relief.

The ballot measure, which is also being backed by Instacart and a delivery company that Uber is acquiring, Postmates, could be a harbinger for gig companies in the rest of the country.

Prop 22 would exempt the companies from complying with a law that went into effect at the beginning of the year, while offering limited benefits to drivers. The law is intended to force them to treat gig workers as employees, but Uber and its peers have resisted, fearing that the cost of benefits like unemployment insurance and health care could tip them into a downward financial spiral.

Although Uber and Lyft, for example, are publicly traded companies with a combined worth of $70.5 billion, they have never been profitable. They lose billions of dollars each year, and the pandemic has made turning a profit even more difficult. DoorDash, which has filed to go public, has also struggled. Analysts estimate that complying with California’s gig worker law could cost Uber, which lost $1.8 billion in its most recent quarter, as much as $500 million a year.

Uber said it planned to cut off work for the approximately 158,000 California drivers who were active on the platform each quarter if its ballot measure failed. It would employ roughly 51,000 remaining drivers, it said, and raise fares to meet the higher business costs.

The ballot fight gained additional urgency Thursday when the California 1st District Court of Appeal ruled that Uber and Lyft must treat their California drivers as employees under the new labor law. The state attorney general and the city attorneys of San Francisco, Los Angeles and San Diego had sued the companies in May to enforce the law.

“If Prop 22 does not win, we will do our best to adjust,” said Dara Khosrowshahi, Uber’s chief executive, in a Wall Street Journal interview this week. “Where in California we can operate is a question mark, and the size and scale of the business will be substantially reduced.”

In past dust-ups with local regulators, Uber rallied its passengers for support. The pandemic has made that difficult, so it has urged its tech employees to get involved and used its app to reach out to drivers for support.

The Yes on 22 campaign also started an effort to organize drivers, a move copied from the labor groups that have long tried to organize drivers to fight for better working conditions. And it has forged relationships with high-profile advocacy groups, like Mothers Against Drunk Driving and the California chapter of the NAACP.

“Drivers want independence plus benefits by a 4-to-1 margin, and we’re going to fight for them,” said Julie Wood, a spokesperson for Lyft. “We believe California voters are on the side of drivers, too.”

A spokesperson for DoorDash, Taylor Bennett, said, “Our support for Prop 22 is part of our commitment to protecting the economic opportunity that tens of thousands of Californians value and the access to delivery that so many restaurants rely on, especially at such a critical time.”

A spokesperson for Instacart declined to comment. Postmates did not respond to a request for comment.

In an effort to gain support, the companies have bombarded riders and drivers with push notifications, campaign ads that appear in their apps and emails promoting Prop 22. Before logging on to start work, Uber drivers have been presented with a slideshow of warnings about how their lives could change if the proposition fails.

“A no vote would mean far fewer jobs,” one of the slides on the Uber app warned. “That’s why we’re fighting so hard to win.”

In the lawsuit filed against Uber on Thursday, drivers claim that the messages violated a state law that forbids employers to coerce their employees to participate in political activity.

“I can’t rule out that employers have engaged in coercive tactics like this in the past, but I have never heard of an employer engaging in this sort of barrage of coercive communications on such a broad level, ever,” said one of the attorneys for the drivers, David Lowe, a partner at Rudy, Exelrod, Zieff & Lowe. “It is such an extraordinary thing, from my perspective, for Uber to exploit this captive audience of workers.” Lowe said he opposed Prop 22.

Matt Kallman, an Uber spokesperson, said, “This is an absurd lawsuit, without merit, filed solely for press attention and without regard for the facts.” He added, “It can’t distract from the truth: that the vast majority of drivers support Prop 22.”

In early October, the Prop 22 campaign was denounced by Sen. Bernie Sanders after a fake progressive group calling itself Feel the Bern endorsed the proposition in a campaign flyer that implied Uber had the backing of progressive leaders. The mailers were, in fact, sent by a firm that creates political mailers representing different views.

“The Prop 22 campaign is working hard to reach voters across the state and the political spectrum to ensure they know that drivers overwhelmingly support Prop 22,” said Geoff Vetter, a spokesperson for the Yes on 22 campaign, which is funded by Uber, Lyft, DoorDash and other gig economy companies.

Questions have also been raised about the NAACP endorsement. A political consulting firm run by Alice Huffman, leader of the California NAACP., has received $85,000 from the gig companies’ campaign, public records show. The payment was reported earlier by the news site CalMatters.

Vetter said the payments were for “outreach.” The NAACP did not respond to a request for comment.

Uber held an all-hands meeting this month for employees to meet drivers who support the proposition, and sent several emails encouraging staff to lobby friends and family.

Although the internal messages were upbeat, the policy staff raised concerns with campaign consultants during the meetings in late August and early September, the people familiar with those meetings said. Among their worries: that the ballot language was unfavorable to the companies and that people were voting earlier than usual because of the pandemic, meaning advertising would need to be rapid and aggressive.

“We look at the data every day, and our metrics show a tight race,” Justin Kintz, Uber’s head of public policy, said in an early October email to Uber employees, obtained by The New York Times. “At the same time, with continued strong execution against our plan, we’re confident we can win.”

While the email noted that campaigning was optional, Kintz encouraged employees to participate in texting banks to contact voters and to promote the campaign in conversations with friends.

“The big reason that you’re seeing so much spending is because of the high stakes in this election,” said Vetter, the spokesperson for the campaign. “Hundreds of thousands of jobs are on the line. These are services that millions of Californians rely on.”

The opposition campaign, which is funded by labor unions, has raised about $15 million. Supporters of the No on 22 campaign have argued that voters should reject the push by tech companies and that the measure would harm workers already at a disadvantage during the pandemic.

“Proposition 22 will make racial inequality worse in California at the worst possible time,” said Rep. Barbara Lee, D-Calif. “You have very clearly crossed the line when you try to claim the equity mantle for a campaign that has always been about allowing multibillion-dollar app companies to write their own law so that they can keep exploiting the labor of drivers, 8 in 10 of whom are people of color.”

No matter the outcome of the vote, the gig companies and their opponents are likely to take their campaigns to Washington. Massachusetts has filed a lawsuit similar to the one that the California court decided Thursday, and Uber hopes to avoid continued state-by-state battles by pressing for federal legislation.



Source link

Continue Reading

Companies

In Gig-Dependent LA, Rent Payments Begin To Skid As Payday Loans Spike

Published

on

By

Reports of the Los Angeles County’s gig worker-dependent economy falling apart ring true, but rent collection numbers, while lower than those from last year across the board, don’t seem to paint Los Angeles as any worse off than other expensive, coastal cities, some experts say. But is paying the rent alone a good indicator of how hard the coronavirus pandemic has hit renters?

Placeholder

Los Angeles County in August had the second-highest unemployment rate in the state: 16.6%, according to the state’s Employment Development Department.

According to data from RealPage, by the last week of August, 91.9% of LA renters had paid their rent, a 5.1% drop from 97% in 2019. By the last week of September, 93.4% of LA tenants had paid their rent compared to the 97.8% that had done so by the same time in 2019, or a difference of about 4.4%.

Stacking this year’s data up against 2019’s offers some necessary context to current numbers, said Adam Couch, a market analyst at RealPage, one of the companies whose data is used for the National Multifamily Housing Council’s nationwide rent payment tracker. The difference between the two years offers a good way to tell how much a metro has been impacted by the pandemic, Couch said.

Los Angeles saw a bigger year-over-year change in rent collection than New York in the last two months. 

By the last week of August, RealPage shows that 90.5% of New Yorkers had paid their rent, a 3.1% drop from the same time in 2019. By the last week of September, 93.3% of New Yorkers had paid their rent, a 2.9% difference over the previous year.

But Couch said that the two metros have regularly been jockeying for position toward the top of the list of biggest discrepancies between 2019 and 2020 rent collection. He highlighted New York, LA and the Bay Area as some of the standouts in terms of decline, with New York being impacted the most. 

Nothing in the data so far stands out about LA or indicates that it’s doing worse overall for rent collection than the Bay Area or New York, he said. “The rent payments in gateway markets have typically seen some of the largest annual declines,” Couch said. 

That’s not totally surprising considering those areas are among the most expensive places in the country to live. 

“It’s more difficult to make rent payments when rents are so expensive,” Couch said.

Additional federal unemployment benefits expiring and the smaller amounts that were being provided by states aren’t going to be as helpful toward paying for rent and other necessities in places where the rent is very high, Couch said. 

Though RealPage’s data doesn’t indicate that Los Angeles renters are particularly hard-hit by the pandemic compared to renters in other cities, a report published by UCLA’s Lewis Center for Regional Policy Studies suggests an additional layer to the story: that perhaps LA renters are going to unsustainable lengths to make their rent payments on time.

“Paying on time and in full, in other words, should not be mistaken for ‘having no problems’ paying rent,” the report said. 

The report COVID-19 and Renter Distress used data from two sources: the U.S. Census Bureau’s Household Pulse Survey, which the bureau undertook specifically to gather data on how American households have been affected by the pandemic. It includes questions about late rent payment and a more detailed survey of 1,000 LA County households conducted by a third party for UCLA.

The report was co-authored by USC Lusk Center for Real Estate Director Richard Green and UCLA Luskin School of Public Affairs associate professors Michael Lens, Michael Manville and Paavo Monkkonen.

Using information from the survey, the report found that “nontrivial proportions” of renter households that were paying their full rent on time between May and July were doing so by using their savings, asking friends and family for help, or by using credit cards or high-interest payday loans. The use of these methods is much higher among households that paid rent late at least once in that time period, or that only made a partial rent payment during that time, the report said. 

The UCLA survey found that just under 40% of renters who had paid rent late at least once and more than 40% of tenants who made a partial rent payment during those months had used a payday loan to help them pay rent during that time. Just under 40% of tenants who paid partial rent during the three-month span reported that they had used credit cards to help them pay rent.

“Looking at people and their ability to make rent, we should not mistake that for an absence of financial distress,” Manville said in a public discussion about the findings.

Source link

Continue Reading

Trending

Copyright © 2019 Gigger.news.