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Lawsuit seeks to throw out California measure that protects ‘gig economy’ business model

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Ride-hailing drivers and the Service Employees International Union filed a lawsuit against California on Tuesday that asks the state Supreme Court to invalidate Proposition 22 on grounds that it is unconstitutional.

Proposition 22 sought to avoid classifying gig workers as employees, as required by California law. The measure was passed by 58% of the state’s voters in the November election after companies like Uber Technologies Inc.
UBER,
+7.24%
,
Lyft Inc.
LYFT,
+4.78%

and DoorDash Inc.
DASH,
+14.96%

spent more than $200 million on it.

See: Uber and Lyft win fight to keep drivers as contractors in California

The lawsuit challenges key provisions of the measure: gig workers’ inability to be included in the workers’ comp system and to collectively bargain, and its restriction on the state legislature to make meaningful changes because of the seven-eighths vote it requires for any amendment to it.

Scott Kronland, attorney for the plaintiffs, said during a news conference Tuesday that Prop. 22 “overreached.” He said the California constitution “gives to the Legislature the power to decide which workers are given access to workers’ comp and OSHA,” something the measure takes away.

The measure, which took effect in mid-December, “illegally limits the power of lawmakers and courts to protect gig workers,” Bob Schoonover, president of the SEIU state council and SEIU Local 721, said.

The plaintiffs, which include the SEIU California and the broader SEIU, plus individual drivers and a ride-hailing customer, cited the many pending lawsuits regarding gig-worker classification in seeking expedited consideration from the court and expect to hear back from the court within a couple of weeks, Kronland said. They asked that the court give respondents 30 days to file their responses.

The lawsuit also charges that Prop. 22 is too broad; ballot measures are supposed to focus on one issue.

“Proposition 22 violates the single-subject rule by burying these cryptic amendment provisions on subjects not substantively addressed in the measure, and in language that most voters would not understand,” the lawsuit says. “The measure grossly deceived the voters, who were not told they were voting to prevent the Legislature from granting the drivers collective bargaining rights, or to preclude the Legislature from providing incentives for companies to give app-based drivers more than the minimal
wages and benefits provided by Proposition 22.”

Ride-hailing giants Uber and Lyft, plus app-delivery platforms DoorDash and Instacart, rely on millions of workers they consider independent contractors. Classifying drivers and delivery workers would upend their business models, they have said as they have fought many lawsuits. Under Prop. 22, they promise to provide workers with guaranteed earnings that are supposed to be equal to 120% of minimum wage; give eligible workers health care subsidies depending on how many hours they work a week; and provide occupational accident and death insurance.

Opponents of the measure say those provisions fall short of full employee protections: The guaranteed earnings do not apply to time drivers and delivery workers spend waiting for a gig; only those with existing health insurance qualify for the health care subsidies; and the levels of accident and disability insurance promised are limited.

After the gig companies’ victory in California, they declared their intention to try to enact similar measures around the nation and world. The measure has also already affected the grocery industry in the state, where in some areas Albertsons Cos.
ACI,
+2.09%

has announced it is discontinuing its own grocery-delivery services and ceding to third-party delivery platforms.

See: Uber brands gig companies’ efforts to reshape labor laws as ‘IC+’

Hector Castellanos, a full-time Uber and Lyft driver from Antioch, Calif., and one of the plaintiffs, said drivers “need a safety net and protections. COVID-19 made that clear.” He also recounted at the news conference that he was hit by another driver years ago and took eight months to recuperate, during which he had no access to workers’ comp.

Uber and Lyft have not returned requests for comment Tuesday.

DoorDash and Instacart referred to a statement sent by Protect App Based Jobs & Services, a coalition formerly known as Yes on 22, which noted that “nearly 10 million California voters” passed the measure and called the lawsuit “meritless.”

“Voters across the political spectrum spoke loud and clear,” the coalition said, attributing the statement to Jim Pyatt, a Modesto, Calif.-based Uber driver.

William Gould, professor emeritus at Stanford Law School and a former chair of the National Labor Relations Board, said “the complaint and brief pose merit, particularly as they highlight an unconstitutional intrusion on the right to organize and to obtain worker’s compensation.”

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Economy

Why This Analyst Sees Huge Upside Potential in Gig Economy Stocks – 24/7 Wall St.

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Government-imposed lockdowns crushed the U.S. economy last year, and to a degree some of the fallout is still lingering. This was especially true for the so-called gig economy, as many ride-sharing apps and delivery apps were forced to back off while everything was sorted out. Yet, with the economy making its comeback, the gig economy is kicking into gear too.

Gordon Haskett looked at three major firms within the industry that focus on ride-hailing and delivery. While stocks of each are substantially higher than they were last year, questions remain about where they stand to go from here.

The underlying thesis for these firms seems to be convenience. As more consumers are working from home, delivery services have become increasingly important. While the pandemic put a damper on the ride-hailing trend, this seems to be squarely in the rearview mirror, as safety protocols have been instituted to keep riders and drivers safe.

24/7 Wall St. has taken a close look at the report and picked out some of the highlights that investors can use to make informed choices on these stocks. Also, look out for Uber and Lyft to report earnings later this week.

Note that Gordon Haskett publishes differentiated, independent research to a targeted group of institutional investors. The company provides analysts with intellectual autonomy, sector-specific senior salespeople, infrastructure and support.

DoorDash

DoorDash Inc. (NYSE: DASH) was the first big name on the list. Gordon Haskett initiated coverage with a Buy rating and a $206 price target that implies upside of 18% from the most recent closing price of $174.29.

The analyst goes into further detail, saying that it views DoorDash as more than just a COVID-19 play. In fact, Gordon Haskett sees it as a long-term play on secular change toward convenience and a topline upward revision story in the marking with the potential for adjacent delivery verticals and rapid international expansion.

Monday morning, the stock traded down nearly 2% to $171.31, in a post-IPO range of $110.13 to $256.09. The consensus price target is $175.47. Shares are up 22% year to date, with most of the gain coming in the past quarter.

Uber

Uber Technologies Inc. (NYSE: UBER) has performed the weakest out of the group, with its share price down about 15% year to date, though it is still up roughly 44% from this time last year. Despite this, Uber was initiated with a Buy rating and a $65 price target. That suggests upside of roughly 50% from the most recent closing price of $43.46.

Gordon Haskett views Uber as a company that will further engrain itself in the everyday lives of consumers. Ultimately, this could lead to share gains across both ride shares and delivery, resulting in upward top-line and bottom-line revisions in the years to come. In the near term, Uber offers investors exposure to the reopening trade and defense against a prolonged COVID-19 backdrop in the form of its delivery service. Again, Gordon Haskett is playing on the convenience trade and sees Uber as well positioned to benefit from this structural shift.

Uber stock traded up 1% to $43.97, and it has a consensus price target of $69.11. The stock has a 52-week trading range of $28.48 to $64.05.

Lyft

Lyft Inc. (NASDAQ: LYFT) has been the best-performed stock of this group over the past year, and Gordon Haskett sees this ride-hailing firm pumping the breaks. Note that Lyft stock is up nearly 13% year to date, and it is a whopping 88% higher in the past 52 weeks. The analyst started coverage with a Hold rating and a $59 price target, which would be upside of about 7% from the most recent close at $55.32.

The ongoing debate over Lyft has been whether it can compete with much larger rival Uber. Yet, Lyft has proven resilient, along with proving the bears wrong by increasing its share in the U.S. market. However, Gordon Haskett sees Lyft as disadvantaged in the coming quarters relative to Uber, as the bigger, badder firm will be taking back some of this market share. The analyst views this as a function of Lyft’s singular product focus, while Uber is diversifying into delivery, essentially building a “super app” that could drive further share gains.

Lyft shares traded up about 2% to $56.36, in a 52-week range of $21.34 to $68.28. Analysts have a consensus price target of $69.34.

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Economy

Major Advancements from this NASDAQ to Meet the Challenges of Employment Needs in Today’s Evolving Gig Economy: ShiftPixy (NASDAQ: PIXY)

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  • Next-Gen Mobile Engagement Tech to Help Fulfill Employment Needs. 

  • Great Experience in Worker’s Comp and Compliance Programs.  

  •  Presenting at Upcoming  D.A. Davidson Bison Select Conference. 

  • MIAMI WORKS Initiative to Restore Miami’s Restaurant & Hospitality Industries by Connecting Business with On-Demand Workforce. 


ShiftPixy (NASDAQ:
PIXY) provides a disruptive human capital management platform, revolutionizing employment in the Gig Economy by delivering a next-gen mobile engagement technology to help businesses with shift-based employees navigate regulatory mandates, minimize administrative burdens and better connect with a ready-for-hire workforce. With expertise rooted in management’s nearly 25 years of workers’ compensation and compliance programs experience, PIXY adds a needed layer for addressing compliance and continued demands for equitable employment practices in the growing Gig Economy.

PIXY will be presenting at the D.A. Davidson Bison Select Conference on Wednesday, August 4, 2021. The PIXY virtual presentation will take place at 11:00 am ET and can be accessed via this link:   https://wsw.com/webcast/dadco55/register.aspx?conf=dadco55&page=pixy&url=https://wsw.com/webcast/dadco55/pixy/1952594 


On June 23
rd PIXY announced the launch of MIAMI WORKS, a staffing and recruiting campaign designed to help the restaurant and hospitality industry navigate the staffing shortage induced by the pandemic. In collaboration with local universities and community development groups, PIXY planned the first in a series of recruiting events for June 26th to help shift workers easily find job opportunities that offer living wages, a sign-up bonus, and flexible schedules, as well as healthcare, workers’ compensation and 401K benefits.

Following the global pandemic, South Florida is facing a severe staffing shortage, a major challenge for the city that thrives on hospitality and tourism business. MIAMI WORKS will help businesses more easily connect with and onboard willing and eligible workers to get their operations back on track, and effectively meet customer demand. Following the inaugural event, PIXY planned a 60-day marketing effort to connect the registered workforce to open positions in the Miami area across restaurants and other hospitality operators.

On top of the labor shortage impacting the restaurant and hospitality industry, third-party delivery services are facing a threat from some authorities of being forced to reclassify drivers from independent contractors to employees, putting their business model and the restaurants they serve at risk. PIXY can provide a stable platform that offers fair wages and benefits for these delivery workers, and allow restaurants to reduce their reliance on third-party services by ramping up their own recruiting and staffing efforts in order to meet pent up demand as COVID-19 restrictions ease up.

“We’re excited to be working with ShiftPixy and our local colleges and universities to address the latest labor challenges in the wake of COVID-19, and show our continued support of the local restaurant and hospitality industries,” said City of Miami Commissioner and Chairman of the Miami DDA Manolo Reyes. “Through the upcoming job fair, and other efforts to connect workers with businesses in these sectors, we’re helping our businesses solve their current staffing issues by promoting the economic, social and cultural health of downtown Miami, and leading the city through its post-pandemic recovery.”

“We’re thrilled to collaborate with ShiftPixy and Miami DDA to create a new avenue for shift workers to effectively identify opportunities at such an important time for the hospitality industry,” said Beatriz Gonzalez of Miami Dade College. “MIAMI WORKS and ShiftPixy are aligned with our mission to support the Miami community, and we encourage participation in ShiftPixy’s upcoming job fair at MDC’s Wolfson Campus.”

In addition to collaborating with Miami DDA, MIAMI WORKS is the embodiment of the local efforts PIXY has made alongside FIU Chaplin School of Hospitality, the company’s Ghost Kitchen Incubator program, FIU Embrace, and others to invigorate the Miami hospitality industry by starting with the most important component – the workforce.

For more information on ShiftPixy (NASDAQ: PIXY) visit: https:www//shiftpixy.com/ 

DISCLAIMER:

CAP/FrontPageStocks/CorporateAds.com (CA) is a third-party publisher and news dissemination service provider. CAP/FPS/CA is NOT affiliated in any manner with any company mentioned herein. CAP/FPS/CA is a news dissemination solutions provider and is NOT a registered broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security. CAP/FPS/CA’s market updates, news alerts and corporate profiles are NOT a solicitation or recommendation to buy, sell or hold securities. The material in this release is intended to be strictly informational and is NEVER to be construed or interpreted as research material. All readers are strongly urged to perform research and due diligence on their own and consult a licensed financial professional before considering any level of investing in stocks. All material included herein is republished content and details which were previously disseminated by the companies mentioned in this release or opinion of the writer. CAP/FPS/ CA is not liable for any investment decisions by its readers or subscribers. Investors are cautioned that they may lose all or a portion of their investment when investing in stocks. CAP/FPS/CA has been compensated $500 by a third party for dissemination of this article.

Disclaimer/Safe Harbor:

These news releases and postings may contain forward-looking statements within the meaning of the Securities Litigation Reform Act. The statements reflect the Company’s current views with respect to future events that involve risks and uncertainties. Among others, these risks include the expectation that any of the companies mentioned herein will achieve significant sales, the failure to meet schedule or performance requirements of the companies’ contracts, the companies’ liquidity position, the companies’ ability to obtain new contracts, the emergence of competitors with greater financial resources and the impact of competitive pricing. In the light of these uncertainties, the forward-looking events referred to in this release might not occur.

Media Contact
Company Name: SHIFTPIXY, INC
Contact Person: CFO: Domonic J. Carney
Email: Send Email
Phone: +1 888 798-9100
Address:501 BRICKELL KEY DR. STE 300
City: MIAMI
State: Florida, 33131
Country: United States
Website: http://www.shiftpixy.com

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Economy

Playground for thieves: Tampa Bay gig worker has mobile payment app account drained

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TAMPA, Fla. (WFLA) — For anyone who uses mobile payment apps like Cash App, Venmo, PayPal and Zelle, your phone is a gateway to your finances.

As the coronavirus pandemic spread, touchless payment options increased in popularity. These apps make it easy to send or receive money faster than ever.

(Better Call Behnken/WFLA photo)

But mobile payments apps have also become a playground for thieves.

“It’s easier to just be like, ‘oh yeah, put my phone number into this app, and you can just send it there,” Frank Wood told 8 On Your Side Consumer Investigator Shannon Behnken.

Wood is a freelancer in video game marketing. Like many workers in the gig economy, he uses mobile payment apps to get payments from his clients.

For years, Wood had no issues using mobile payment apps. Then one day, he woke up to find his Cash App account drained to nothing.

“The first one was right there, $212, [then] $206, $206, $298.88,” Wood said, showing the transactions on his phone.

Tonight at 6 on News Channel 8, Better Call Behnken explains how the scam works and gets results for Frank Wood.

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