While San Francisco is an earthquake-prone region, the tremors that recently shook two ride-share companies headquartered in the city—Uber and Lyft—had nothing to do with seismic waves. Worker strikes and a labour law are disrupting companies that have long profited from exploiting labour.
‘Disrupt’ has to be Silicon Valley’s favourite word. This is a region known for tech disruptors disrupting the work of other tech disruptors. The region is so full of tech billionaires making profits at the expense of underpaid labour, that some in the industry were unprepared for labour disrupting their profits.
“Today, we are disrupting the status quo and taking a bold step forward to rebuild our middle class and reshape the future of workers as we know it,” California Assemblyperson Lorena Gonzalez said in September, when the state passed Assembly Bill 5 (AB5), popularly called the gig work bill. Gig, a word once associated with live music performances, is now used to describe the temporary jobs that help run some of Silicon Valley’s best-known companies. The new law, which comes into effect on 1 January 2020, is set to benefit a million Californians in the gig industry, as it will prevent companies from misclassifying their workers as contractors instead of employees. They will now be eligible for benefits such as minimum wages, paid sick days and insurance.
California governor Gavin Newsom, who signed the bill into law, wrote an opinion piece for the Sacramento Bee in which he said the economy had “stopped working for working people” with corporate profits going through the roof, while the middle-class and working people grew poorer. “Contributing to this imbalance is the misclassification of workers, where companies eager to save on labour costs identify workers as ‘independent contractors’ rather than employees,” he wrote, adding the new law would reverse this trend of misclassification.
Uber and Lyft drivers have been at the forefront of the movement to pass the new law ending misclassification. Drivers have held protests outside Uber’s headquarters seeking better wages. Their message has been rather simple—pay us a living wage. “Dara, I can’t pay my rent. How is your $17 million mansion?” read a placard held by an Uber driver outside the company headquarters. The placard was addressed to Uber CEO Dara Khosrowshahi. Ahead of Uber’s IPO in May, its drivers around the world, from Birmingham to Melbourne, participated in a global strike to protest low pay and long work hours. “The only thing drivers are asking for is fair pay. Uber is doing everything except fair pay,” a driver told The Guardian. Low-paid Uber drivers sleeping in their cars is now a well-known phenomenon.
While Uber and Lyft drivers canvassed for AB5, their companies used every trick in the book to oppose it. Though they are rivals, Uber CEO Khosrowshahi and Lyft’s co-founders Logan Green and John Zimmer, wrote a joint editorial in San Francisco Chronicle three months ago, in which they talked of how the challenges faced by their workforce could be overcome by amending existing labour laws and dismissed AB5 on the grounds that drivers enjoyed the flexibility their jobs offered, instead of forced schedules. The editorial implied drivers would lose job flexibility if they were classified as employees.
Economics professors, labour lawyers and labour associations like Gig Workers Rising have trashed the argument that the new law would curb flexibility, pointing out that nothing in the law prevents employers from providing their employees with flexibility. A tweet from Gig Workers Rising spoke of how companies were fear-mongering over the loss of flexibility, whereas real wages and benefits could coexist with flexible employment. Shannon Liss-Riordan, an attorney who represented thousands of drivers in a class action suit against Uber, told The Verge that Uber and Lyft were trying to deceive their employees into thinking they would have to give up their flexibility if they want employment protection. Drivers have also raised questions about just how flexible they actually are. A New York Times op-ed by former part-time Uber and Lyft driver Harry Campbell says they have taken away a lot of flexibility over the years, with software and algorithms that share information selectively with drivers, giving them incentives to work when and where the company wants.
Both companies tried using the flexibility card to get their drivers to sign a petition against the bill. In June, Uber and Lyft drivers received notifications on the app asking them to sign a petition against a new law that would take away their freedom to drive whenever they wanted to. The petition didn’t mention AB5 by name. Many drivers say the notifications were misleading, and they ended up accidentally signing the petition against a law that would benefit them. Uber and Lyft lobbied for an exemption in the bill, promising to pay their drivers better and provide them with some benefits, if, in exchange, the companies were not forced to classify their drivers as employees.
The bill, now passed into a law, does not exempt Uber and Lfyt. Both companies, along with delivery service DoorDash, have pledged $90 million to support a ballot measure in 2020 that would exempt them from the bill. A ballot measure is a form of direct democracy in which a petition can be placed before voters.
Irrespective of who wins the next round of the battle, there is no denying that California’s labour movement has shaken the ground beneath some of the world’s most powerful tech companies. The world has long been inspired by Silicon Valley tech companies. It’s now time to sit up and take notice of its labour.
Anahita Mukherji
An independent journalist based in the San Francisco Bay Area
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