California Democrats turn up pressure on gig economy

The battle between California lawmakers and major employers such as Uber and Lyft is heating up

ByKathleen Ronayne Associated Press
July 10, 2019, 7:30 PM
Anthony Rendon
Assembly Speaker Anthony Rendon, D-Lakewood, speaks in support of a bill to limit when companies can label workers as independent contractors, during a rally in Sacramento, Calif., Wednesday, July 10, 2019. The measure, AB5 by Assemblywoman Lorena Gonzalez, D-San Diego, aimed at major employers like Uber and Lyft, was approved by a Senate committee and still needs approval by the full Senate. (AP Photo/Rich Pedroncelli)
The Associated Press

SACRAMENTO, Calif. -- The battle between California lawmakers and ridesharing companies such as Uber and Lyft heated up Wednesday as Assembly Speaker Anthony Rendon offered harsh words laced with expletives for businesses in the gig economy.

"They use a lot of really cute words basically to describe the same old (expletive) that they've been doing for a really long time. People keep acting like they've invented new things — it's the same old thing. It's about corporations trying to oppress workers," Rendon, a Democrat, said to cheers at a rally on the Capitol steps. "When you hear about folks talking about the new economy, the gig economy, the innovation economy, it's (expletive) feudalism, all over again."

His remarks came after a Senate committee advanced legislation that would limit when certain companies can label workers as "independent contractors." The proposal by Democratic Assemblywoman Lorena Gonzalez of San Diego, who boasts strong union backing, uses a standard for classifying employees set by the state Supreme Court last year.

It would require more companies to treat their workers like employees entitled to wages and benefit protections. The bill targets ridesharing and food delivery companies such as GrubHub and DoorDash, while carving out exemptions for a variety of other businesses including real estate agents, doctors and some hair stylists.

The bill could radically change how the gig economy works in the state that's home to Silicon Valley and many of the companies the bill seeks to regulate.

Uber and Lyft oppose the bill but say they are open to creating their own set of worker protections in California such as a base wage and creating a driver's organization to advocate for workers. Courtney Jensen of TechNet, a company that represents businesses such as Uber and Postmates, told lawmakers the companies are looking for a solution that balances worker flexibility while providing modern labor protections.

The California Chamber of Commerce has launched the "I'm Independent Coalition," featuring workers talking about the benefits of being independent contractors.

Jennifer Barrera, executive vice president for the chamber, said the chamber supports the intent of the bill but wants more exemptions. She said the state needs to develop a model that allows gig economy workers to have flexibility still.

"The number one thing you hear from drivers is they want the flexibility that the gig economy offers them, and you just can't have that same flexibility with the employment model," she said.

The bill has already passed the state Assembly but needs approval in the state Senate. It will not come up in the upper chamber until lawmakers return from a monthlong summer break that begins Friday.

"If the new normal is, 'If I hire you over an app, you have no rights,' every one of our jobs are at stake," said Gonzalez, the bill's author.

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