
Update on AB5 - dawhizkid
https://www.uber.com/newsroom/ab5-update/
======
dawhizkid
Uber's defense is that it is licensing lead generation software to drivers,
and that it just takes a commission from each trip as payment for use of its
software.

In many ways, I can see it. I think the issue lies in a lot of Uber's current
policies around drivers e.g. very strict rules around cancellations. If Uber
was just a lead generation provider then it shouldn't care or intervene if a
driver decides they don't want a job, but depending on the scenario you can be
punished if you don't want to take a job.

Part of me thinks Uber could get away with this if they just relaxed some of
their current driver policies (e.g. more limited penalties for cancellations).
The issue is whether doing so would drastically deteriorate the quality of the
service for riders.

~~~
bscphil
> Part of me thinks Uber could get away with this if they just relaxed some of
> their current driver policies (e.g. more limited penalties for
> cancellations). The issue is whether doing so would drastically deteriorate
> the quality of the service for riders.

I'm going to go with yes. The only times I use ride sharing services (Lyft,
not Uber) are in high-density situations like getting to and from the airport.
Depending on the hour there will be dozens to hundreds of drivers hovering in
the area trying to get rides. As soon as "rider available" appears on screen a
dozen different drivers are mashing the accept button.

Up until a year or two ago, the drivers would then see where I want to go and
then call me on the phone to say they didn't want to go there, telling _me_ to
cancel the ride they had accepted. I systematically refused every time so that
(usually after a few minutes) they would give up and cancel it themselves.
This would usually happen for 2 or 3 drivers in a row, making ride-sharing a
miserable experience for me.

I assume the cancellation penalties have been made much more serious, because
this hasn't happened to me in a while now.

~~~
aianus
This comment doesn't make sense to me (as a part time Uber driver myself).

First, the driver doesn't see your destination until he picks you up.

Second, there is no competition or reason to rush to "mash" the button, the
ride request is exclusive to you as a driver for the 10 seconds that you see
it.

~~~
hailk
Drivers often call you and ask you where your drop location is. Depending on
your answer, they often cancel. Or worse, ask you to cancel. I've even had
cancellations after I've sat in the car.

~~~
Cthulhu_
Doesn't that basically give them a bad mark and cause the software to no
longer give them rides? I mean that's grounds for firing if it was a regular
taxi company.

~~~
hailk
I'm not based out of US, so the experience will vary. My understanding of
drivers getting bad marked is that here the demand for Uber at peak times is
still larger than the supply, hence even though you might be penalised via de-
prioritisation, uber would still get you a ride to fulfil. They are also
penalised by being given lower pay incentives. But talking to most drivers,
the trade-offs of cancelling are worth it for them, since they often cancel
drop locations from where demand would be lower, or to far off places where
they wouldn't get another ride to complete, or have to go out of the way to
return to the area they generally are comfortable operating in.

Whenever I've raised this issue with Uber(via their absurdly bad support
feature), I generally get an automated response in the line of "We're so sorry
for the bad experience, we understand that this has caused you a lot of
trouble... We take your feedback seriously..", etc.

------
pslam
Uber's defense fails The Duck Test. They are describing a job, people doing a
job, people paying for a job, and people taking a cut of the profits. They
just don't use those words.

I suspect if/when this gets to a higher court, the whole thing will come
crashing down, because to allow Uber's weaselly redefinition of common terms,
would be to allow other classes of employment to similarly become unprotected.

~~~
kstrauser
I totally agree. I'm neutral on Uber, but their advertising is that you book
an Uber ride. You don't use Uber to find a driver you like and then hire that
driver from now on. Basically, the drivers are treated as the fungible part of
providing service to the passengers. Contrast with Airbnb where owners can
treat it like an advertising network to market their rental room, and it's
totally reasonable to expect that a good experience will lead to more business
for that homeowner specifically, not just the app in general.

~~~
carlob
As a matter of fact I know of one person who met a driver through Uber and
decided to hire them daily to get to their job without going through Uber ever
again. I think that this is extremely rare and that everything in Uber is set
up to prevent something like this. Same thing goes for Airbnb and the
obfuscation of emails.

~~~
spookthesunset
It is rare. The reason Uber and Lyft don’t have the same “work outside the
network” problem that Wag / Airbnb does is because when you want a ride you
want it now. If you had to wait for your “personal” driver to free up, you’d
be waiting... or have to deal with scheduling in advance.

You schedule dog walks and lodging in advance, so it is quite tempting to cut
the middle man out once you find what you like. Not so with transportation.

------
ajkjk
I feel like it's pretty clear that gig economy jobs don't neatly fit in either
of the existing categories of workers: they're not quite employees (you can
clearly work or not work whenever you want) or contractors (you clearly have
very little negotiating power or information in choosing your work or
guaranteeing your wages). Attempts to munge them into one of those categories
are just doomed; a new category is needed.

Failing that, if they are to be counted as individual contractors they should
be able to negotiate like those: without one-sided deceptive deals.

~~~
JMTQp8lwXL
Ridesharing companies, Labor, and the California legislature missed an
opportunity to identify a third type of employee. The truth is always
somewhere in the middle, and the most objective truth (to me) suggests that
rideshare drivers honestly sit somewhere between employees and contractors.

The politics of what has occurred here is probably the pendulum swinging too
far, but in the right direction: the classification of 'contractor' just isn't
correct to describe these workers, and the legislature did its best to rectify
that.

~~~
malandrew
> the legislature did its best to rectify that.

my experience is that this is hardly ever true in politics. Legislators are
generally balancing what they think is right (or what they think voters think
is right) with what is in their own self interest (such as getting re-
elected). As a result, they most often do their best to serve their own self-
interest first and foremost. They raarely try to rectify something if
rectifying it is at odds with their self-interest.

Rectifying this situation would likely involve some third category "somewhere
in the middle", but that's not what we got.

~~~
basch
They would be more like contractors if economies of scale favored open cross
compatible ride sharing platforms, instead of proprietary institutions and and
oligopoly.

If there were 10 ridesharing apps, and any customer could reach any driver
using a different app, would you still consider the driver as having not
negotiation power? The driver could uncheck "allow riders from uber" if they
didnt want uber provided leads. Ride hailing should be as open as SMS, and
then drivers AND passengers would gain power in the relationship. By using
government to benefit consumers and shun proprietary lockin, the issues could
be solved without creating a new employee class. The root need for that class
in the first place is Ubers anti-competitive side.

~~~
JMTQp8lwXL
But then the driver is at the mercy of the aggregator App. It's the same
problem as working with Uber or Lyft directly, really.

~~~
spookthesunset
Setting aside the rider... in my world Uber and lyft would have open apis so
third party apps could somehow aggregate the two services.

These apps would be pretty basic and just let the driver accept rides from
either service from within the same app.

Dunno if this is actually a problem though...

~~~
pishpash
Aggregation already exists for both riders and drivers. For riders there is
Google Maps. For drivers there is Mystro and the like.

------
lacker
I think the law will be bad for the people it affects, so this is good news
for Uber drivers. Uber isn't operating at a profit, so they don't have extra
margin to pass on in the form of extra driver pay or employee benefits. If
Uber has to shrink their business in California or exit entirely, that won't
be good for drivers either.

It reminds me of before my software engineering career, when I was working at
The Gap. The job wasn't great, but a lot of people really needed more hours.
Unfortunately, there was a rule that nobody could work more than 29 hours a
week. Everyone hated it. Employees hated it the most because if they needed
extra money they couldn't take an extra shift. The managers hated it too
because it was just more rules for them to deal with.

Apparently, this rule existed because there was a law saying that past 30
hours a week, employees had to get some extra benefits. Gap corporate just
changed the job to avoid that law. As a result, that job got worse, and nobody
got more benefits. Just unintended consequences.

~~~
slg
This line of thinking can be used against almost any form of labor
protections. People don't work in sweatshops because they love the job, they
do it because they are desperate. That desperation allows their employer to
take advantage of them. The government therefore needs to step in to protect
the workers from being taken advantage of. In an ideal world that regulation
would also come with some type of social safety net to protect the workers in
event of any of these negative repercussions. That safety net is much more
difficult to get support for politically (because it costs money) so it is
usually an afterthought.

~~~
wavepruner
I hear this argument a lot, and I wonder, would anyone who has gone through an
extended period of poverty agree with it? I went through this myself, and all
the worker "protection" laws just made it that much harder to get back on my
feet because they limited how much I could work. Or forced me to allocate some
of my pay to benefits I didn't need rather than the expensive treatment I
desperately needed to stay alive in the short-term.

I drove for Uber and it was seriously the only job I could get and it saved my
life. I know of many other drivers who are battling disabling conditions who
drive for Uber as well. Jobs that are as flexible as Uber are non-existent.

I find it really disappointing how many people debate this issue without ever
actually listening to the people in poverty. That means talking to real people
doing the job. Not just the protestors in the streets. And frankly, if you
have time to protest, you're probably not that poor. The poorest of the poor
work whenever they can and do not spend time on things that don't earn them
money.

~~~
ixtli
> if you have time to protest, you're probably not that poor

i dont know what protests you've been attending but the one's ive helped at
for laundry and warehouse workers were filled with people that were not only
supporting families on minimum wage but also contained people who were here on
visas.

in america you're _always_ taking a risk by protesting an employer.

~~~
wavepruner
It's all relative. To me anyone who can work full time is not that poor. But I
understand why many would view that as poverty.

~~~
ixtli
Minimum wage is not, on its own, enough to afford average rent anywhere in
America. If you're making minimum wage and have no other access to support:
you're poor.

This is, ultimately the major reason why the status quo never changes here:
people dont want to acknowledge their class.

------
npmaile
As someone who drives Uber on occasion when I'm a little bored and looking for
something to do, I think it's great that I'm not an Uber employee.

I can do 10 hours or I can do 0 hours based on nothing but my own whim. I
don't have a problem with people organizing to get a better deal for
themselves, but I like the way it works now.

I've worked for companies that misclassify workers, and Uber isn't it as far
as I understand. I may be convinced otherwise, but I don't see it.

~~~
organsnyder
There is very little downside for the employee to be classified as such rather
than as a contractor. The vast majority of the downside is for the employer.

I'm a W-2 employee at the company I work for, and they don't dictate my hours.

~~~
DaiPlusPlus
Don’t forget the “exempt” vs “non-exempt” status for W-2 workers though.

~~~
organsnyder
That impacts whether you're eligible for overtime pay. Given that contractors
are never mandated to receive overtime pay, a contractor position can never be
superior in this regard.

~~~
seanmcdirmid
Exempt status also impacts whether your hours are fixed or not. If they tell
you that you must be in the office from 9AM to 5 PM, then you aren’t exempt.

~~~
dragonwriter
> If they tell you that you must be in the office from 9AM to 5 PM, then you
> aren’t exempt.

That's not correct; the difference is that failure to fulfill such a
requirement is a discipline issue (which can be dealt with by discipline up to
an including termination), but not a pay issue based on hours worked as it
would be for a non-exempt hourly employee.

[https://www.lexology.com/library/detail.aspx?g=1b7b6851-8415...](https://www.lexology.com/library/detail.aspx?g=1b7b6851-8415-4148-9deb-20675f879ec5)

------
igurari
For those interested in understanding the underlying case law that AB5
codifies (a decision called Dynamex Operations West, Inc. v. Superior Court),
my company, Judicata, published a visual (and tech-enabled) explanation of the
decision when it was first published:
[https://blog.judicata.com/understanding-dynamex-the-
californ...](https://blog.judicata.com/understanding-dynamex-the-california-
supreme-courts-response-to-silicon-valley-cdf281d75d2e)

Whether or not Uber drivers are employees or contractors under Dynamex and the
ABC test is an open question, but the Uber explanation of the bill's impact is
more or less correct.

~~~
choppaface
One of the tests is: “that the worker is free from the control and direction
of the hirer in connection with the performance of the work, both under the
contract for the performance of the work and in fact”

Since Uber rates drivers, does background checks, sets the routes, leases
cars, etc., how does Uber plan to avoid this check? Do ratings sort drivers,
or is Uber effectively creating a credential that governs the driver? What
does the distribution of driver activity look like?

It’s hard to believe an all-or-nothing determination will hold. Surely some
fraction of most-active drivers will end up getting called employees.

It’s one thing to explain the law (and case law) and yet another to provide an
explanation with evidence. The latter is what we need (especially as voters),
yet the former is what lawyers like to peddle because it makes them money.
Uber’s post is almost 100% legalese. CEO Dara had an opportunity to make a
grounded statement here, but didn’t.

------
tsycho
IIUC, AB5 might end up making Uber a monopoly in California (and US if other
states follow suit) via regulatory capture.

Currently, most drivers seem to drive for both Uber and Lyft (based on their
cars having stickers for both). But if classified as employees, and being
guaranteed a minimum wage, then Uber/Lyft might require them to be exclusively
available. As a result, the drivers will have to choose either Uber and Lyft
and since Uber has more market share, they will likely choose Uber and Lyft
will be squeezed out.

What am I missing/misunderstanding above?

~~~
maxerickson
Not that many people will agree to exclusivity for minimal wages, certainly
not for hours they aren't scheduled and paid.

~~~
tsycho
True, but the majority opinion driving AB5 seems to be that most drivers are
doing this as their full time jobs. Yes, there are those who drive a few hours
occasionally as a hobby or for extra side income, but they don't count much.
If the number of Lyft drivers falls significantly, consumers will have to wait
longer to get a Lyft ride and they will start abandoning Lyft. Hastening the
spiral.

Another comment mentioned that Lyft might pay drivers more to keep them, but
given that both Uber and Lyft are hemorrhaging money, it seems unlikely that
either will be willing to pay drivers more. Also, Uber just needs to pay the
same as Lyft for a little while, and just wait out the decline of Lyft due to
AB5.

~~~
aianus
> Yes, there are those who drive a few hours occasionally as a hobby or for
> extra side income, but they don't count much.

The post from Uber clearly states "In the US, 92% of drivers drive less than
40 hours per week, and 45% of drivers drive less than 10 hours per week."

~~~
kadoban
How are they counting? Would not be surprised if those numbers were only
including time driving to pick up and driving to drop off.

------
SauciestGNU
I think the proper classification of drivers is likely an existential threat
to Uber, and they are responding as such. I find it highly unlikely that a
court would find _transportation_ to be outside the scope of Uber's business.
Although you have to almost admire the sheer brazenness in their admission
that they will not adhere to the law.

~~~
eggpy
> you have to admire the sheer brazenness in their admission that they will
> not adhere to the law

I mean, that has been Uber's MO since they started. AirBnB too, nothing new
about this

~~~
SauciestGNU
Yeah, I'm not surprised they intend to violate the law. I'm surprised that
they're broadcasting their intention in advance.

~~~
AaronFriel
There's some nuance being lost here - they aren't saying they will violate the
law, they are saying that their lawyers will advance an argument that the law
(ABC test) does not apply to them.

I think the legislature and many on HN believe that courts will think it's
absurd that Uber's drivers are doing work "outside the usual course" of Uber's
business. I'm inclined to agree, but I'm not a lawyer and I don't know how
well written the law was or whether California courts will include legislative
intent in applying that language.

~~~
shkkmo
The article pretty clearly states that Uber believes it will continue to pass
the ABC test.

~~~
AaronFriel
You're right about the article, I was responding to people in this thread:
"broadcasting their intention [to break the law] in advance", "[admitting]
that they will not adhere to the law" and so on. Those are the statements I am
responding to.

~~~
shkkmo
I was responding to your incorrect assertion about the argument ABC's lawyers
would advance (as indicated by the article.)

~~~
AaronFriel
Perhaps you should have indicated that's what your disagreement was, I think
we agree but you misrepresent what I mean by "apply". Since it's not clear
what it means to "pass" or "fail" the ABC test, and Uber is using the term
"pass" to indicate that condition of the test is false (i.e.: failed), I used
the term apply.

For example, when the Lemon test applies to something, it's because all of its
three prongs are true. Is that a "pass" or a "fail"? That distinction I think
is irrelevant to the law, but I'm sure the litigants on both sides would argue
that their argument is good ("pass"), and the opposing argument is bad
("fail").

A city putting up decorations for a religious event and denying others would
argue that they have "passed" the Lemon test, while articulating that one of
its conditions "fails".

A litigant against such a city would argue the city "fails" the test.

I did not want to use Uber's language ("But just because the [ABC] test is
hard does not mean we will not be able to pass it") because their job is to
frame things positively for their client. Passing the ABC test is trivial -
I'm doing it right now! So are you! What we care about is whether or not the
test _applies_ to something, that is, it entails some _consequences_ , and
Uber is going to argue that one of the specific prongs of the test will fail.
From their view, this is a win, and this is them "passing" the test.

So, I used the word apply.

------
tyxodiwktis
When the ACA passed, mandating that large employers offer health insurance to
all full time employees, there was a massive push by large employers in retail
and food service to cap people's hours and make sure very few qualified as
full time. This was because health insurance costs employers about $10k per
employee per year, and if you are paying someone $10/hr ($20k/yr at 40hrs a
week), raising labor costs 50% is a nonstarter.

An outcome like that may be possible here as an unintended consequence, with
Uber and Lyft capping most drivers at 20hrs a week, and full time drivers
splitting their time between the two (20hrs for each).

~~~
avocado4
Real solution is universal healthcare.

~~~
dehrmann
The problem is that health care is attached to employment. The solution might
take the form of universal health care, it might be not-so-universal private
health care, it might be some hybrid. But don't gloss over what the problem is
because you'll lose common ground with people and end up arguing over the
solution and not agreeing that there's a problem.

------
basch
I think there is more truth to their argument than people are giving them
credit for. It seems like an in bad faith perspective to not give their claim
some credence. It makes YOUR argument stronger to first make the best version
of Ubers argument before rebutting it.

Does it make me a Microsoft employee if I use Outlook to conduct business?
Does it make me an Ebay employee if I sell things through ebay? Until Uber
eliminates the ability for drivers to drive Uber and Lyft simultaneously, and
bounce between the services at will, I DO view it as drivers paying for 1) a
dispatch and messaging service 2) payment processing 3) insurance 4) a resume
host 5) a customer funnel. Thats more than just a technology or software
company, Uber sells transportation services to drivers. The fact alone that
they can have two messaging/dispatch apps open at once, on two phones, makes
me question, which company do you think the driver works for? Both
simultaneously? Just the one that the passenger is from? Is having both Uber
and Lyft open looking for passengers any different than listing something I
have for sale on Etsy, Ebay and Amazon, and pulling the listing once it sells
out?

~~~
eaurouge
Ebay doesn't control how much you sell your product for. Ebay doesn't police
how you sell, package, or ship your product. It's mostly hands off. Compare
this with the level of control Uber exerts on its drivers.

Similarly, Ebay's service is less dependent on how well you provide your
commerce services, it pretty much lets the market determine your prospects on
its platform. On the other hand, Uber is highly reliant on the conduct of its
drivers and the service the provide.

~~~
spookthesunset
Uber and lyft have to dictate the price the end user pays. Nobody would use
the service if they had to collect bids from a bunch of drivers each time they
wanted to go somewhere. As a result they wouldn’t have an effective pool of
customers needed to attract drivers.

I agree with others. These “gig economy” jobs are a different classification
of worker that doesn’t currently exist. Dunno what the details should be but
they aren’t quite contractors and they aren’t quite employees.

California could have taken the lead and helped define this new
classification...

~~~
caconym_
A corporation's illegal business practices don't become legal just because
they're required to sustain its business model.

I don't think your post makes a strong statement to this effect, but it
suggests it, and it's good to be clear on this point.

~~~
askafriend
Can you explain how what they do is illegal?

~~~
wpietri
Making it illegal is the the whole point of AB5. Contractor status was once
for a very specific kind of worker: independent professionals who were
basically solo businesses. It has turned into a giant loophole, where worker
have the downsides of employment along with the downsides of being a
contractor. AB5 aims to return to the status quo, where if you want to hire a
bunch of employees, you really have to treat them like employees.

~~~
spookthesunset
Except they aren’t employees. They are something else. Make a new
classification for them.

~~~
jakelazaroff
They were arguably employees before (and outside of CA) and unarguably
employees under AB5. That’s why Uber is making this ridiculous claim that it’s
not a transportation company: otherwise, its drivers are employees.

------
40acres
Why aren't other industries up in arms about this? I work for Intel and we
have a ton of contractors, so does Google. Under 'A' of the 'ABC' test, it
seems to me that most contractors for these companies would now be employees.

~~~
glitcher
I'm not familiar with the details of the bill, but in this letter from the
uber CLO it mentions:

> due to eleventh-hour amendments to the bill, many industries are now exempt
> from the new ABC test that AB5 will codify into state law

Anyone have information on the exemptions added to the bill, specifically if
it exempts most of the big tech companies?

------
JMTQp8lwXL
Uber's former mission statement:

> "Transportation as reliable as running water, everywhere for everyone"

Sounds like transportation is their core business to me.

~~~
sneak
A mission statement is not a product or service offering. Google doesn’t sell
“the world’s information”, for example.

~~~
ablerman
Sure it does, it just doesn't sell it to you. You are not the purchaser of the
information, you are providing the information that's being sold.

~~~
kinkrtyavimoodh
Google does not sell information to anyone. Please don't spread outright
falsehoods.

------
aznpwnzor
> Our proposal avoids the potential harm of forcing drivers to be employees,
> whether or not they want to—and the vast majority tell us they don’t want to
> be.

> Contrary to some of the rhetoric we’ve heard, AB5 does not automatically
> reclassify any rideshare drivers from independent contractors to employees.

This may seem like an immediate contradiction, but I guess they've reframed it
so their proposal is actually in line with AB5?

great pr-speak

> But just because the test is hard does not mean we will not be able to pass
> it. In fact, several previous rulings have found that 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.

Also seems like they will continue to thwart where they can (which I can't
blame them for really) but seems aggressive to note. This reads more like a
shareholder update, which makes sense.

~~~
smacktoward
I read it differently:

 _> Governor Newsom has already committed to sign AB5, which would go into
effect in January 2020. Because we continue to believe drivers are properly
classified as independent... drivers will not be automatically reclassified as
employees, even after January of next year..._

 _> Uber and Lyft together have already transferred $60 million into a
campaign committee account, and we are open to investing more to put us in the
strongest position possible to run a winning campaign... We are confident that
California voters and the millions of riders and drivers who use Uber will
step up to protect these important work opportunities._

Translation: "We're betting that we can get a ballot initiative passed
legalizing what we do faster than the State of California can bust us for
violating AB5."

~~~
shkkmo
You may have missed this part:

> Importantly, our ballot measure will not ask voters to exempt us from AB5,
> even though nearly every other industry in California that works with
> independent contractors received an exemption from the ABC test through
> special amendments I mentioned earlier. Instead, we will ask voters to
> support the pro-driver policies we have advocated for: giving drivers access
> to benefits and an earnings floor and retaining the flexible access to on-
> demand work they enjoy today.

It doesn't sound like the proposal is intended avoid compliance with AB5 but
to create conditions where new bills that make the ABC test harder pass will
have less support.

------
eridius
> _drivers’ work is outside the usual course of Uber’s business_

What... how... I don't even know where to begin with this.

~~~
gotoeleven
Cool I look forward to Uber drivers showing up with a rickshaw or giving piggy
back rides.

~~~
scarejunba
Uber in India offers autorickshaws. And I've got a vague memory of seeing
rickshaws/pedicabs in Seattle (but this could be a false memory).

------
Animats
_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._

 _We expect we will continue to respond to claims of misclassification in
arbitration and in court as necessary, just as we do now. But we will also
continue to advocate for the independence and choice that drivers tell us
again and again in surveys, polls, focus groups, and personal conversations
that they value most._

Uber management is not going to get the message until top management goes to
jail for contempt of court.

~~~
ilaksh
There is nothing about providing benefits to people who meet the criteria for
employment that prevents Uber from allowing drivers choice.

They will not be able to keep as many drivers or allow infinite drivers to
sign up, and they will not be able to pay benefits to people who only work a
very small amount per week (I assume this is in the law). But beyond that,
there is absolutely no reason they cannot or should not continue to let
drivers sign in and out when they want.

~~~
SomewhatLikely
What should they do to drivers who don't meet their minimum hours needed to
pay for the benefits in a given week? Fire them? Immediately? Should it be a
warning? How many warnings do you get? Meanwhile is Uber/Lyft still on the
hook for all the benefits? How can they avoid these flaky drivers? Better
screening upfront such as an interview? How will drivers feel when they get a
notification they have to drive 8 hours today or they'll get a warning because
it's the end of the week and they are short. What if it's a slow day and Uber
doesn't need more drivers today? It would make more sense to spread drivers
hours out of over the week. The relationship starts to sound drastically
different for both parties. Especially for the 45% of drivers working less
than 10 hours currently who will have to find other side jobs or go without.

~~~
ilaksh
There would need to be a grace period and there would be a warning. There is
no reason someone needs to be immediately fired just because they have a light
week.

------
FfejL
Uber: AB5 doesn't affect us. Also Uber: We are prepared to spend $60M to stop
it.

------
supernova87a
What I have a hard time understanding is the 3rd of the 3 tests that determine
if a person can be classified as independent contractor. [1]

I understand A & B, but as for C, why does someone's normal job have to be in
that same line of work to be considered an independent contractor? What does
whether a person is a driver professionally, or a teacher making money on the
side, determine whether they're performing work as a contractor?

Maybe someone more expert can explain.

\-------

[1] ABC Test that all 3 conditions must be satisfied for worker to be
considered a contractor:

"... (a) that the worker is free from the control and direction of the hirer
in connection with the performance of the work, both under the contract for
the performance of the work and in fact; and (b) that the worker performs work
that is outside the usual course of the hiring entity’s business; and (c) that
the worker is customarily engaged in an independently established trade,
occupation, or business of the same nature as that involved in the work
performed.”

------
kwindla
Could someone knowledgeable about employment law explain what will change for
Uber/Lyft drivers if the companies are forced to reclassify them as employees?

The post talks about "potential harm" and says that how many hours drivers
have to work and whether they can work for competitors at the same time "would
all change." Is that right?

~~~
the-pigeon
This is just a PR post by Uber. Don't take any of it as fact.

No one knows the true impact of this. Companies will find lots of interesting
ways to follow the letter of the law but not the spirit of it. As they always
do.

If you really want speculation on it then find someone who's actually a lawyer
and not directly affected by it (so they aren't biased). Which I haven't seen
yet.

(Detailed writeup on why speculation on things like this is almost always
wrong [http://larvatus.com/michael-crichton-why-
speculate/](http://larvatus.com/michael-crichton-why-speculate/) )

------
dragonwriter
I like how they both claim that the law does not actually apply to them, and
that they are exploring working with Lyft and others on a statewide ballot
measure in response to the law (clearly, implicitly, a referendum to reverse
it.) They are careful to avoid making the self-contradiction explicit, but the
implication is clear.

------
xivzgrev
That is a clever argument that they are in business of lead generation. But if
that was true then the consumer wouldn’t know Uber, they would know x ride
share service. The problem with Uber is they also control the end user
experience and pricing, so it’s a real stretch to argue they are not in the
business of providing rides to customers.

Honestly I think their argument could be bolstered a lot if they made a simple
change. Imagine you call an Uber, then your app tells you billy wants your
job. You can see he is 4.5 star rated with 1000 rides, he is est 3 min away,
and he wants $15. Do you accept? If so Uber connects you. If not Uber goes
back to finding someone else.

With that change Uber removes itself from being in the business of rideshare,
and now is in business of connecting drivers with riders (as they’ve claimed
all along). They need to let drivers dictate prices and ask users to choose.

~~~
Lucadg
It could work. Airbnb does that and still kind of manages to control prices by
favouring listings which conform to Pricing Tips in the search results.

------
jher17
Uber’s disrespect for the law is astonishing. I hope California cracks down on
them hard for not complying.

------
justapassenger
Would love to see source data that Uber is referencing (I know it's not
possible, as it's highly guarded secret) - I suspect they cherry pick it a
lot.

"In the US, 92% of drivers drive less than 40 hours per week, and 45% of
drivers drive less than 10 hours per week. [...] We will continue to defend
the innovation that makes that kind of choice, flexibility, and independence a
reality for over 200,000 drivers in California".

1\. Does this distribution looks in California, not across whole US? Why talk
about two different cases, unless you cherry pick? 2\. How does this % look
like, when we look at drivers that work for more than few months?

~~~
dtrailin
A very clever thing they're doing is conflating being an employee with not
having flexible hours, as if part time jobs don't exist. Fast food chains
don't hire independent contractors and yet lots of people have flexible
shifts.

~~~
darkwizard42
Not exactly...consider the following problem:

Fast food chain is busy from 12 AM - 2 AM, 5 PM - 7 PM. These shifts may be
desirable or undesirable because of the time they occur. To be able to get the
"easy" shifts (slow ones) at 10 PM or something, they can make it so that you
HAVE to take a part of the other shifts... If you can't, you don't meet their
eligibility and you lose your job.

If you are an employee in a shift based business, you definitely give up some
rights to having completely flexible work hours.

------
shkkmo
The reporting around this law is absurd.

Despite how it is covered, the law notably fails to do ANYTHING to help gig
employees as it just codifies existing case law.

What this law does do is carve out exceptions in that case law so that gig
employees have LESS protection.

This law could have been paired with other real protections for gig employees
but that did not happen. No minimum wage guarantee extensions, no rights to
organize, no improvements in access to the safety net...etc

How do people let our politicians get away with claiming they are protecting
people with a bill that does nothing but erode those protections?

~~~
shkkmo
I guess it might be considered a protection in that it won out against bills
like AB71 that would have reversed the Dynamex precedent.

------
dmitrygr
So basically their tactic is to eke out a few more years out of their business
model as their fight with California over the classification slowly snakes its
way through the courts to the California supreme court, and hope that in the
meantime they can come up with a better business model?

It is actually not a terribly bad idea. They have the money to pay for the
slow court battle, and it is strictly cheaper than complying.

~~~
ilaksh
They already lost in the California Supreme Court.

~~~
dmitrygr
Dynamex lost (Dynamex Operations West, Inc. v. Superior Court), which caused
AB5 to be written. Uber did not yet lose (or even get sued) over this yet IIRC

------
Camillo
I would be interested in hearing a principled defense of the exception that
was granted to other industries. Would anyone care to try?

~~~
henryfjordan
Some of the exceptions were for professions like Lawyers, Accountants, and
Professional Engineers. There are already well established protocols for
interacting with these people, so let's not complicate things with AB-5.

I'm sure some of the exemptions are not so cool though.

~~~
pishpash
What have established protocols got to do with anything? The question at hand
is, is Dynamex a good, widely applicable test or not? Yes or no? If it is,
then use it. If it isn't, something is severely broken, which you plainly see
with so many exemptions, and it should not be used.

------
lr
They continue to use the term "rideshare", which just boggles my mind. So, I
guess "share" in this case means that Uber is "sharing" a "cut" of the
proceeds with the driver. Maybe they should call it, "fareshare" (but then
that would be a play on words that turns out to be an oxymoron).

~~~
duskwuff
That's an interesting point, actually. Uber and Lyft do both support shared
rides (which they call Uber Pool and Lyft Line, respectively), but my
understanding is that the vast majority of their rides are not actually
"shared".

------
lr
Honestly, would the, "three important points" have even been a remote
consideration of Uber, Lyft, etc., if this legislation was was not even
proposed (let alone passed) in the first place?

This sounds a lot like someone apologizing and saying they are deeply sorry,
only after they are caught doing something wrong.

------
ausbah
Uber always positions itself to be whatever is most advantageous for it given
the current situation. Just a "technology-based platform", no, they are a just
a modern taxi company that uses a tech platform.

I think for many "big tech" companies there needs to be a paradigm shift in
how society views them, not as pure tech companies that produce technology
solely for technology's sake, but like Uber - companies that use tech as a
means to an end of a another business (in most cases). Facebook as a news
company, Amazon as a retailer, Airbnb as a short term rental unit provider,
etc. (these aren't all necessarily accurate descriptions).

------
Legogris
I can read between the lines an assumption that Uber will do the bare minimum
required by law while exercising all restrictions on drivers they are legally
allowed to.

How can they be for self-organization of drivers (as states in the release)
while battling in other state courts for prohibiting unions?

If they want to allow drivers to also drive for other platforms (again, from
the text), just don’t enforce such clauses in employment contracts.

They’re talking about all the changes they supposedly want to see while the
only thing stopping it from happening is Uber deciding not to.

As if being an employee must mean a rigid schedule and inflexible working
hours.

------
DeusExMachina
> Our current offer represents a new progressive framework that includes:

> Establishing — for the first time ever — a guaranteed minimum earnings
> standard

> So as you can see, we are not arguing for the status quo.

Well, ok. The real question though is why.

Only companies with massive investments can afford to burn cash to keep the
price to the final user as low as Uber's.

Such regulation would reduce the number of competitors appearing on the
market.

------
dclusin
Seems like it will bring uber & lyft's cost basis in line with cab drivers,
making the latter group competitive again.

------
jasonhansel
> We expect we will continue to respond to claims of misclassification in
> arbitration and in court as necessary, just as we do now.

Translation: "We want to help our workers by fighting against their own
attempts to assert their legal rights. We will do so in special courts where
we hire and pay the judges. This will be perfectly fair."

------
ProAm
>Bringing drivers access to robust portable benefits like sick leave and
injury protection;

What? Those are embarassing offers.

> Our proposal avoids the potential harm of forcing drivers to be employees,
> whether or not they want to—and the vast majority tell us they don’t want to
> be

I would love to see the data behind the 'vast majority'

~~~
djrogers
I'd bet the huge percentage of drivers that simultaneously do Lyft _and_ Uber
would not like being an employee of one or the other, as their employer would
prevent that.

------
dawhizkid
I wonder what'd the courts would say if Uber decided to charge a nominal fee
(say $1/year) for the driver app in the App Store? That would make it more
obvious that it's a piece of software that is being licensed by drivers for
lead generation.

------
RcouF1uZ4gsC
It seems Wall Street is not all that worried about AB5.

[https://finance.yahoo.com/quote/UBER/](https://finance.yahoo.com/quote/UBER/)

Looking at the 5 day stock trends, it seems up compared to last week.

~~~
duskwuff
AB5 didn't appear out of nowhere, and its passage didn't come as a surprise.
The potential impact of AB5 on Uber's business would have been priced into the
stock as the bill progressed through the legislature.

------
627467
this is probably going to be labeled as a naive view, but to me it's clear
that no one cares about the spirit of the sharing economy (not even corps like
uber or airbnb): no one should be dedicating 100% of their "work time" to
ubering... nor buying up properties to rent it out as airbnb permanently... I
thought it was about unused/wasted time/resources that could be shared (for
some profit).

Corps likely airbnb and uber should probably go back to building their
platforms to promote occasional resource assignment rather than permanent.

~~~
paulcole
> I thought it was about unused/wasted time/resources that could be shared
> (for some profit).

This is the fiction sold by AirBnB, Uber, etc. You just can’t grow forever (as
these companies require) by “sharing.” Do you think investors would continue
to happily light billions on fire if Uber didn’t have huge ambitions?

This is very similar to Etsy. Founded as a handmade marketplace until they
realized not enough people make stuff by hand to keep growing. Now it’s just a
mass-produced shit shop just like every other place.

------
shawndellysse
Are they really trying to claim that Uber is not a transportation company but
instead "a technology platform for several different types of digital
marketplaces"?

I guess we do live in a post-truth era.

~~~
joeyrideout
The post was written by their CLO. They are not trying to claim as such, they
are succeeding. I am not a lawyer, but I don't think this legal interpretation
of the company is a lie. It seems like the classification is constantly under
scrutiny. A legal falsehood like you claim it is would've fallen apart by now.

~~~
FireBeyond
Lawyers argue all the time. It's not a legal truth because their chief
attorney says so. They are entitled to claim (within reason) as much as anyone
else is.

And, of course, they will claim the most favorable definition. In other
situations, notably when they are arguing against entrenched transit/transport
interests, they "become" a transport company. It's a question of which hat
fits the day.

~~~
dymk
FTA:

> But just because the test is hard does not mean we will not be able to pass
> it. In fact, several previous rulings have found that 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.

Previous rulings have found his statement to be accurate. So you don't have to
take his word for it, you can take a judge's.

~~~
stilist
Those rulings were made without the context of the new law, though, so the
results may be different.

~~~
shkkmo
AB5 just codifies the precedent under which those rulings were made.

------
jasonhansel
Summary: "This bill does absolutely nothing to affect us. But please don't
pass it, or at least let us compromise, since it would affect us so much."

Seems a little bit contradictory?

------
matz1
The government seems to be solving the wrong issue. Shouldn't the government
instead fix the Whatever it is that makes being classified as contractor suck
in the first place?

------
xxxpupugo
As regards to the hour claim, if the law goes into effects, what would happen
to those drivers who can't drive 40 hours per week?

~~~
s1artibartfast
If the court rules that Uber drivers are employees per the AB5, my guess is
there will be no more drivers with 40 hours a week. Ride sharing companies
will just do what fast food has done and cap working hours at 29 per week to
avoid healthcare benefits. This will also mean that neither uber or lyft can
capture the market, because they will need each-other to supplement hours to
the drivers.

------
paggle
It’s nuts for Uber to talk about their “offer.” They don’t make the offer, the
voters do.

------
kaesar14
What's the defense of a business model that loses bucketloads of money despite
not treating their drivers with the dignity they deserve? Both Uber and Lyft
are not going to be killed by regulation, they're going to be killed for being
shitty businesses.

------
gzu
Perfect way to eliminate the competition via regulatory lock out

~~~
landcoctos
It's not really sharing anyway.

~~~
tracker1
Yeah, the term really got me when I first heard about Uber... my thoughts was
it was more like a near-demand carpool service to pull together extra
passengers for where you were going anyway (for a small fee). Reality it's
more like a Taxi service with private vehicles.

Still wouldn't mind seeing another ride share app with carpooling as the
focus.

~~~
jfk13
Yes, calling it "ride-sharing" has always been disingenuous at best. I suspect
the idea was to make it sound more small-scale and personal, less formal and
commercial, so that people wouldn't feel it needs regulation or oversight as
much as a commercial transportation service.

------
bww
tl;dr "Bill clearly aimed specifically at us doesn't apply to us."

------
djsumdog
Wow, just .. wow. I thought it was going to be Uber's plan of coming under
compliance of AB5 and sugar coating the entire thing to made them sound like
some honorable people. But no, they're still scum. You get half way through
and you realize it's just business as usual. We're going to ignore, fight and
not give a shit about the law.

The build up to this legislation was that it was specifically around companies
like Lyft, Uber, Dolly, etc. To argue against this just shows how desperate
the company is to not give up anything.

Personally I stopped using Uber in 2016 and never looked back. I'd rather pay
more for a Lyft. If both of them disappear tomorrow, there will always be
Taxis; and maybe cities will finally start building out real mass transit like
America has needed for decades, instead of hanging on to the brain-dead dream
of a self-driving cab.

~~~
Axsuul
Honestly, how much did you use taxis before Uber/Lyft came around?

