Uber and Lyft drivers and other platform workers are calling on California to enforce its new employment law as illness, confusion, and hardship from COVID-19 sweep their industries. Worker groups are also calling for the $110 million set aside by Uber, Lyft, Doordash, Postmates, and Instacart for fighting that law to instead be used to give workers some relief.
On Thursday, ride-hail drivers in California gathered outside Uber headquarters in San Francisco, Los Angeles, and San Diego to demand that gig platforms provide immediate relief to their cash-strapped, at-risk workers, including by adhering to California’s new labor law known as AB5.
Members of the groups Rideshare Drivers United and the Transport Workers Union held demonstrations and a press conference Thursday (standing six feet apart, for safety) calling for increased, immediate support from platform companies as well as the state government of California. Ahead of today’s events, the groups also circulated a petition with a short list of ‘asks,’ including immediate enforcement of AB5 and reallocation of companies’ anti-AB5 lobbying dollars.
Uber has advised its corporate workers to stay at home, and announced March 15 that it will offer drivers access to two weeks’ worth of scaled compensation if they test positive for COVID-19 or receive a medical note telling them to stay home. Lyft, Postmates, and other gig-economy firms have also released various plans, but many workers have argued publicly that such plans offer conflicting terms and insufficient pay, or don’t provide an option to stay home before they’re exposed.
In recent days, news outlets and social media platforms have drawn growing attention to the often chaotic, increasingly dire circumstances that ride-hail drivers and other gig workers have faced during the current viral outbreak. Organizers of today’s actions, which include a separate petition and press call by the Mobile Workers Alliance, say that recently announced federal assistance and platform companies’ own plans won’t do nearly enough to alleviate gig workers’ physical and financial strain.
California driver-organizer and RDU member Tyler Sandness explained in a phone interview, “The whole point of this action is that the virus is going to impact people in the gig economy probably more than most people; that these are people who have been living hand-to-mouth for years, who don’t have a safety net or something to boost them up during this crisis.”
“We’re demanding the state step in and streamline the unemployment process, and give us access to the same resources and programs that all employees are entitled to,” Sandness said. “So we’re calling for immediate enforcement of AB5, which should give us those rights.”
Michael, a Bay Area Uber and Lyft driver with an active wage claim against ride-hail platforms, also said in a statement that because he lives in San Francisco, and is thus “required by order to shelter in place,” going to work on the apps could even amount to a misdemeanor legal violation, punishable by a fine or jail time.
For now, the order specifically exempts gig workers under providing “essential services,” but this could change or see varied enforcement. Workers also say the result of current conditions is that they’re taking heightened risks through an unprecedented demand surge — performing key services for the public as effective first responders — without even the minimum of protections.
“Enforcement would recognize me as an employee and grant me minimum wage pay plus all California employee benefits including sick and healthcare pay, which is an employee right and a life or death consequence during [this] pandemic,” Michael wrote. In a statement, the platform companies’ joint campaign to overturn or revise AB5 called its initiative “forward-thinking policy that protects the access to flexible work an overwhelming majority drivers say they want, while providing historic new benefits like health care, accidental occupation insurance and a minimum wage guarantee.”
Sandness said the fight for reclassification and employment rights under AB5 might normally have played out over months (or longer) among workers and labor lawyers — for example, by suing companies like Uber and Lyft for unemployment benefits — but that, now more than ever, workers and their families can’t afford that timeline.
“We understand there’s a typical process when it comes to this kind of employment law, that obviously this is not a standard procedure,” Sandness said. “But we’re not living through a normal situation — we’re living through a crisis — and we won that law, which is pretty unambiguous about classifying gig workers as employees, with all the rights that come with that.”
“Uber might not want to admit that, and might still be foolishly allocating millions of driver-earned dollars toward fighting that law. But people are not going to survive the months we’re living through this crisis without government stepping in to help.”
In the meantime, drivers’ groups and other labor advocates have attempted to round up their own support for gig workers as much as possible.
As Megan Rose Dickey reported Wednesday for TechCrunch, the Gig Workers Collective, led by InstaCart worker-organizers Vanessa Bain and Sarah Clarke (who uses a pseudonym), put together a mutual aid tool and state-by-state resource list for workers around the country “because no one has stepped in to help yet, [so] we must help each other.”
Bain, an Instacart big earner-turned-organizer and company critic, commented in a phone interview, “I think it’s really important right now to feel like you have a community to lean on.” Surveys have shown that gig workers in particular have been feeling lonely and powerless in today’s economy, and as the rise of COVID-19 promises to reshape that economy in unprecedented ways, “We need each other as coworkers now more than ever,” she said.
To that end, Bain said, “Access to resources is really important right now, because a lot of people will understandably feel powerless in this situation. But there are measures in place: things like hardship deferment [on bills], unemployment, MediCal, and SNAP [food stamps].”
She and her husband, who’s also a gig worker, already qualified for Medicaid-like MediCal healthcare, have now applied for SNAP, and are “trying not to spend any money,” Bain said. After making certain key minimum payments this month, they’ve also been working to defer any bills they can — something she encourages other workers to consider. “You need that dollar in your hand right now far more than Capital One does,” she said.
Bain also encouraged gig workers to apply for unemployment, healthcare, SNAP, and other programs even if they previously tried but were rejected; not only should AB5 ensure many of those protections, she said, but since the demand for many workers (such as Uber and Lyft drivers) has plummeted, workers’ circumstances have significantly changed.
If workers are “stuck at home” for any reason, she said, “I would highly recommend being proactive and find resources that work for you. It’s also a pivotal time to keep pushing for rights for workers, and to have workers feel empowered instead of helpless — I know how paralyzing that is, and it’s last thing we want right now.”
And as much as gig workers have in common, some of the problems they’re facing are vastly different, Bain noted. “Rideshare drivers are really struggling right now to find work, but the pendulum swung in the opposite direction for delivery services, especially ones with groceries,” like Instacart and Amazon Flex.
A week or two ago, Instacart reported a surge of 20 times as many orders in hardest-hit US cities, and 10 times as many nationwide, Bain said. “I would speculate at this point that it’s even higher than that,” she said. This past weekend reportedly had the platform’s highest ever sales, too, creating a one-to-two-week backlog on deliveries.
At the same time, while ride-hail drivers “have some very unique risks,” Bain said, because every passenger is easily within six feet of them, “Delivery people also do, because in a grocery store — one of the few things open right now — you’re touching a lot of different surfaces throughout.”
The delivery platforms have “done absolutely nothing to provide prophylactics to their shoppers,” she said, who are “only using what they have, can find, and can afford, which is oftentimes nothing.”
University of California, Hastings law professor and labor specialist Veena Dubal said in a phone interview that ‘emergency’ or rapid enforcement of AB5 could immediately help these workers “to the extent that the [California] governor and secretary of labor could put their minds at ease that they will have something to live on. Especially because these companies have been so irresponsible about paying into unemployment insurance.”
Dubal, who helped promote and participated in today’s events with RDU and TWU, said that the text messages she’s been receiving from gig workers and their advocates in recent days “are heartbreaking.”
As her three children worked on making cookies in the background, she went on, “People are trying to figure out where to get food, they are desperate, they are considered essential workers right now — they’re actually vectors for the disease — and they have been asking for these protections for years.”
Regarding the federal government’s recent employee protection bill, Dubal added that it “doesn’t help these workers at all; there’s a huge gap for gig workers.” As for most of the protections contained therein, she said, “Most Californians already have them.”
Stacey Wells, campaign spokesperson for the app-funded Protect App-Based Drivers & Services Act, which seeks to reverse AB5 through a ballot measure, commented in a statement, “Organizing public events during a global pandemic for political points, while counties all over the state are issuing mandatory shelter-in-place orders, is not a worker benefit, it’s an irresponsible PR stunt that jeopardizes the health of drivers and the public.”
Nearly 3 in 5 Gig Workers Earned Less Than $1,000 a Month During Pandemic
Traditional nine-to-five office workers aren’t the only ones having a hard time during the pandemic — gig workers also have seen their livelihoods greatly impacted.
More than two-thirds — 68% — of gig workers who perform services such as making deliveries and ride-share driving said their total income has declined during the COVID-19 outbreak, according to a new report by venture capital firm Flourish Ventures.
For many gig workers, their earnings aren’t enough to meet their most basic needs.
A precipitous drop in gig workers’ income
Many gig workers saw a dramatic drop in income between March and the summer months of July and August.
16% of gig workers earned $4,000 or more
32% earned between $2,000 and $4,000
32% earned between $1,000 and $2,000
20% earned less than $1,000
In contrast, during the months of July and August:
5% earned $4,000 or more
14% earned between $2,000 and $4,000
22% earned between $1,000 and $2,000
59% earned less than $1,000
People of color have been particularly hard hit by the crisis. An earlier survey found that job concerns were weighing heavier on Latinos than other groups.
Among Black gig workers, 61% earned less than $1,000 in the past month, according to the Flourish Ventures study. Additionally, 71% of Black workers said they were “very concerned” about COVID-19 compared with 68% of Latino workers and 55% white workers.
Gig workers using savings, borrowing to get by
Gig workers have turned to a variety of measures to withstand the current economic crisis. Nearly two-thirds — 63% — have dipped into their savings during the pandemic. Other tactics taken include:
Cutting spending (62%)
Borrowing money (55%)
Finding new or additional work (39%)
Selling or pawning something they owned (33%)
Reducing or cutting bill payments entirely (33%)
With a reduction in income, some gig workers are having to choose between using their money to buy food and spending it on bills and other priorities, such as health insurance. Of those who have cut their spending, more than half — 55% — cut back on food. Meanwhile, 24% reduced their entertainment costs and 21% cut back on household bills.
Among the gig workers surveyed, more than 3 in 4 — 77% — received an economic impact payment as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Of those who received a payment, 66% said they were able to cover their living expenses for more than a week compared with 53% of those who did not receive a payment.
Those who did not receive a payment from the federal government were also more likely to feel hopeless about their situation. Nearly half of those who did not receive a payment — 46% — reported a lack of hope. Of those who did receive a payment, only 35% reported such feelings.
Methodology: Flourish Ventures partnered with Steady, a gig worker platform, and 60 Decibels, a research firm, to survey 695 gig workers in five cities in the months of July and August 2020. Among respondents, 31% were from Atlanta, 22% were from New York, 19% were from San Francisco, 18% were from Chicago and 10% were from Philadelphia. When it comes to the racial/ethnic makeup of respondents, 41% were Black, 33% were white and 13% were Latino.
How COVID-19 accelerated SA’s move to the gig economy
The pandemic has redefined the workplace for employers and employees: rigid constraints have been removed in terms of place and time in a new remote economy where the workforce has shifted to include the expertise of gig workers.
These changes were happening anyway because of the fourth industrial revolution, but being locked out of our offices for more than six months has accelerated this trend by between five and 10 years.
While the pre-COVID world of work already saw a move away from the old-fashioned notion of having to work in one place at one job, the pandemic has turned traditional employment models on their head, in favour of more agile workforces augmented by experts who are employed on a contingent basis, bringing their particular skill set to a company as and when needed.
Gig workers allow businesses to be more flexible in terms of scaling up or down fast − an essential survival tactic when competition to deliver new products and services is intensifying and the demand for scarce, digital skills such as cloud computing, machine learning, big data, cyber security and more are increasing rapidly.
The lockdown response to the pandemic has dramatically transformed the workplace. Deloitte has called the COVID-19 pandemic “a time machine to the future”, while theHarvard Business Reviewdescribed it as the “most significant social experiment of the future of work in action, with work from home and social distancing policies radically changing the way we work and interact”.
This has upended the workplace, validating the significance of remote working as a viable alternative to the necessity of the physical presence of the traditional business model.
Having become accustomed to having workers scattered outside the office, businesses have become more comfortable augmenting their teams with talent sourced outside the company.
The pandemic has turned traditional employment models on their head, in favour of more agile workforces.
More and more firms are outsourcing skills to complement or expand their current talent pool. This “gig” economy is more efficient and cost-effective, but importantly, allows access to talent in far-flung geographies.
While a shift towards contingent labour of the gig economy was already under way prior to the pandemic, the COVID-19 pandemic has brought the benefit of flexible working into sharper focus, highlighting its crucial role in enhancing business productivity without the associated costs of employing permanent staff.
The gig economy has been a rising trend for some time now, first emerging in the wake of the 2008 financial crisis. Some 64 million individuals in the US and European Union are gig workers − the fastest growing area of job creation, according to McKinsey. In the African context, McKinsey estimates that 63 million people in Africa are involved in some type of self-employment.
These numbers are receiving a significant boost, with most organisations surveyed expecting contingent work to play a key role in shaping people strategy in the near future as professionals seek flexible alternatives to traditional employment.
Many workers who are joining the gig economy are doing so to be more flexible − foregoing job security and other perks to have more control of their working lives.
With this flexibility comes great responsibility to keep skills up to date, as this is no longer the role of an employer.
Accessing a digitised labour market platform for the right talent without being limited by geography is the upside for companies.
Now businesses can expand their talent pool, closing skills gaps in the IT and digital skills space, according to the demands of particular projects.
Employees in turn can work at a growing number of jobs that can be done anywhere there is access to a computer or smartphone. Additionally, according to McKinsey, most independent workers who have actively chosen the gig working style report high levels of satisfaction with it.
The COVID-19 tipping point
Employers and employees have become comfortable with remote work. Previously, many organisations didn’t trust employees to work remotely, concerned they would not be able to manage productivity.
In a survey conducted by Boston Consulting Group, a large group of respondents reported being able to maintain or improve productivity. In the past, many felt the need to engage with clients face to face, often travelling across town, the country or even overseas to attend a single meeting.
Having now spent months meeting via video-conference, productively, it’s unlikely that all meetings will revert to face to face once this crisis is behind us.
Working remotely and attending meetings via video-conference has allowed companies to think more broadly about resourcing.
As businesses have put the necessary controls and processes in place to function effectively without the physical presence of employees, it has opened our minds to the possibility that not all staff will be permanently employed. Relevant expertise can be engaged regardless of location.
Many organisations have decided that when employees return to the office, it will be on a more flexible arrangement. Seventy percent of staff surveyed would prefer a hybrid model − to return to work for some of the time and be based remotely for the balance of their time.
In this landscape, companies will increasingly leverage a blend of external and internal resources, combining a stable, permanent workforce for their core skills requirements, complemented by on-demand, highly-flexible resources as required.
By augmenting the current workforce with gig talent, companies gain a competitive-edge in productivity and service delivery while simultaneously reducing cost and mitigating the financial risk of a large, permanent workforce.
The COVID-19 crisis has given businesses an opportunity to re-imagine their existing talent strategies and incorporate alternative workforce models as a critical lever for growth. This will see a workplace with a blend of onsite and offsite teams, comprising permanent and gig workers.
As businesses begin to adjust to the post-pandemic normal, we will see an increasing move away from traditional, inflexible staffing models as the independent workers and the gig model become mainstream as businesses embrace the benefits of a flexible workforce.
The gig economy has the potential to bring much-needed economic benefits, providing a solution to addressing South Africa’s unemployment crisis by opening up opportunities for independent workers in the South African job market and internationally.
In turn, businesses can leverage this on-demand workforce solution to radically transform the workplace, boosting productivity, efficiency and the competitive-edge of their organisations in the post-pandemic environment.
Gig economy under the microscope as former Deliveroo driver takes company to Fair Work Commission for unfair dismissal
The debate over whether food delivery drivers deserve employee rights has once again entered the courts with a former Deliveroo driver taking the company to the Fair Work Commission to argue he was unfairly dismissed.
The case is the first of its kind in Australia against Deliveroo and could see a judge rule that a Deliveroo delivery driver is an employee, rather than a contractor.
Ever since rideshare and food delivery apps launched in Australia, the legalities of the gig economy have been under the microscope.
Despite multiple cases around the country and internationally about alleged unfair treatment by these companies, not much has changed.
And Federal Government intervention might be the only way to change the state of play.
So what’s the issue?
The main sticking point that sees drivers take companies like Uber and Deliveroo to court is whether delivery and rideshare drivers are employees or independent contractors.
Companies including Uber, Lyft, Menulog, Deliveroo and Uber Eats argue they are not delivery or rideshare services but instead provide a flexible platform to allow independent contractors to be in the business of food delivery and ridesharing.
“The companies say these people aren’t working for us, we are providing tech support to a business the contractors are running,” says Andrew Stewart, a law professor at the University of Adelaide.
“This is how their contracts are constructed. The contracts try to make it clear they are providing tech support to a contractor.”
But some drivers, backed by unions, argue they are being misrepresented and should receive worker protections such as minimum wage, annual leave, sick leave, superannuation and be protected by unfair dismissal laws.
Companies including Deliveroo, Uber Eats and Menulog will do anything to stop their riders being classed as employees under the law so they can avoid paying entitlements that could threaten the viability of their business model.
What have previous court cases ruled?
Unfortunately for the workers, there are a few details in their contracts that have continued to prevent courts from agreeing they are employees.
The most common include:
- The ability for drivers to work for multiple platforms at the same time
- No requirement of a uniform or for drivers to associate themselves with a company
- Drivers/deliverers can work whenever they like and;
- No-one is obliged to take up any jobs
But drivers and delivery riders argue they are not treated in this way and are instead threatened with being blocked from the apps if they refuse too many trips or deliveries.
Australian lawyer Sheryn Omeri, who is currently working in the UK and has represented Uber drivers in Britain, says the Fair Work Commission is having to contend with the novelty of the gig economy.
“The Fair Work Commission and the courts are accustomed to calling ’employees’ people who are contractually obliged to attend an office at 9:00am and not to leave until 5:00pm and to devote all of their working time to one employer organisation.”
The courts are grappling with the idea that someone may fall within the definition of an employee but have work arrangements that are completely different than anything they have seen an employee do before.
In the case of Uber, Ms Omeri argues that because once someone logs into an app, they must accept a certain number of jobs allocated to them or they will be forcibly logged out, they are being treated the same as an employee.
They also cannot cancel more than a certain number of jobs that they have already accepted without risking their account being permanently deleted.
In a statement, an Uber spokesperson said people who drive and deliver with the company can “choose if, when and where they earn” and said there was “definitely” no requirement to accept a certain number of trips.
“Uber believes that everyone should have access to a set of affordable and reliable social protections, whatever category of employment they are in,” the spokesperson said.
Will upcoming court decisions make a difference?
Unfortunately, the chances of that are slim.
University of Adelaide’s Professor Stewart says, “The one thing you can guarantee is that we will not have certainty unless and until there’s legislation”.
One decision by a court is unlikely to set a precedent for the industry because of the nature of the industry; it’s flexibility.
“Each of the platforms are constantly changing their work methods and contracts. They are constantly reacting to litigation, what’s happening in the market and what their competitors are doing.
“This litigation might end up being an incredibly significant case but it’s not going to be particularly significant until there’s an appeal that makes it up further and into higher courts.”
A precedent could theoretically be set if a case gets to the High Court. But University of Sydney Professor of Labour Law Shae McCrystal says this is unlikely because of the way the law works.
“Just because you hire person A and they are found to be an employee it doesn’t mean person B is an employee. It’s not automatic,” she said.
What else could be done to change things?
Professor McCrystal says what we need is a clearer definition of someone who either works to pursue the interests of another business (an employee) or for their own business (a contractor).
“You need a response that’s not relying on individual employees to challenge their contractual terms to achieve an outcome. You need to be proactive with regulation,” she said.
“We need a statutory definition of employment that is easy to apply and harder to get around.”
Some countries have done this — created a new name and definition for workers like Uber drivers called, for example, dependent contractors.
But there are issues with that, Professor McCrystal says.
“I don’t like that because what happens and it has happened, is when you say OK, we’ll have a new category, a midway point, workers who are employees get pushed into that new category.
“A better solution is to stop regulating employees and contractors and just have workers.
“If we can create a model that genuinely distinguishes between someone who is pursuing the business interest of another, and someone who genuinely works for themselves, then we could create a definition of a worker.”
Why hasn’t it happened yet?
In short, it takes time and there’s not a lot of demand for it.
It’s worth noting that while some drivers say the system is failing them, users of these services are benefiting from low prices.
The gaps in labour law that are exploited by these companies allow consumers to get food delivered to their door without leaving the couch, and to catch a cheaper and faster ride home from the airport than if they had to line up at a taxi rank.
Research conducted by the Victorian Government found almost two-thirds of Australians rely on these on-demand platforms to buy goods and services.
If the system changes to benefit the driver, those costs are likely to be passed on to the consumer in the form of higher prices.
Professor Stewart said the simplest answer to creating positive and lasting change to on-demand workers’ lives is to have the Federal Government “step in and sort it all out” by changing our labour laws.
“But there is not the faintest bit of interest by the Commonwealth Government,” he said.
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