What Biden and Harris are proposing:
During the presidential primary, many Democrats took aim at gig companies such as Uber and Lyft, arguing that they exploit low-wage workers by classifying them as freelancers instead of employees. Converting their status to employee would make workers eligible for more job protections and overtime pay. The issue is big for organized labor because it also makes more workers eligible to join unions.
Bernie Sanders was the first candidate to call for national legislation to bar gig companies from classifying workers as freelancers. A few months later, Elizabeth Warren announced support for California legislation that limits which industries can employ gig workers and pledged to enact a similar federal law.
Since then, both Biden and Harris have said they back that state law and oppose a proposition that would carve out an exemption for app-based drivers. Though Biden has not said whether he supports a similar policy at the federal level, his campaign website stresses that his administration would prioritize the regulation and prosecution of “employers intentionally misclassifying their employees as independent contractors.”
What California is doing:
Gov. Gavin Newsom signed legislation in 2019 requiring many businesses to reclassify independent contractors as employees. The law is projected to impact 1 million workers, including janitors, manicurists and gig workers. It also gives the state and large cities new authority to go after companies that don’t comply. Throughout the debate over the bill, organized labor lobbied hard for it to pass, while businesses fought to exempt their industries from the new requirements. Some industries won exemptions, but many did not. In his signing statement, Newsom expressed hope of finding a compromise.
How’s it going here?
The new law was being challenged from all sides even before it went into effect Jan. 1.
Trucking companies won a reprieve from the law while their court challenge to it proceeds, but freelance journalists did not. In the months since, the Legislature has carved out more exemption for musicians and interpreters. Gig workers have filed a class-action lawsuit seeking retroactive pay, overtime and benefits.
Gig companies such as Uber and Lyft have continued to argue the state law doesn’t apply to them. The state disagrees and has sued. The ride-hailing companies briefly threatened to shut down operations in California altogether, but backed down after winning a reprieve from the courts.
The law has also become an electoral hot button issue. One legislator ostensibly already lost his seat because of it and Republicans are hammering their Democratic opponents for their vote on bill. Uber, Lyft and Doordash have poured more than $110 million into the Proposition 22 campaign hoping to convince voters that their gig workers should retain flexibility as freelancers.
In short: it’s messy.