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California appeals court rules Uber, Lyft must reclassify drivers as employees

357 points by BigBalli 6y ago

JumpCrisscross 6y ago
> Remedying those harms more strongly served the public interest I hate reporters using this language to describe court opinions. It’s a legal term of art that makes decisions sound political. The judge ruled based on the law. Lawmakers balance public interest. Yes, the court furthers that through its work, but it isn’t actively creating the scales by which to weigh these parties’ interests.
- deleted 6y ago
  [deleted]
- drewblaisdell 6y ago
  > The judge ruled based on the law. Are you basing this on anything other than the ideal that we Americans are taught about how courts work? In practice, a reasoned argument can be made for two or more interpretations of law and judges are often entirely "political".
  - pmiller2 6y ago
    "Judges rule based on the law," and "judges' decisions are inherently political" are not inconsistent statements. In other words, why not both?
  - not2b 6y ago
    AB5 was very clear about how Uber and Lyft drivers should be classified. There wasn't any ambiguity and it wasn't a hard case. If Prob 22 wins, then that part of AB5 is overruled. If not, drivers are employees entitled to minimum wage and everything else employees are entitled to.
    - gnopgnip 6y ago
      And AB5 was just clarifying what the law after Dynamex v. Superior Court
  - rectang 6y ago
    One of the great distinctions between natural languages and programming languages is that programming languages have comparatively little ambiguity — because computers do not have the capacity to consider external context when interpreting the intention of the programmer, and thus cannot resolve ambiguous constructs. You'd hope that tech folks, from constantly having to accommodate this defect of computers, would develop a sophisticated appreciation for ambiguity. Instead, it seems that the ability to appreciate nuance atrophies. Legal language may be more formalized than everyday language, but there is still lots and lots of ambiguity. The idea that there is a single correct interpretation of "the law" is nothing more than collective self-deception.
    - thelastbender12 6y ago
      The distinction between natural language and programming languages is interesting, given the push towards machine learning and programming 2.0 that switches explicit instructions in code for training using examples.
- moioci 6y ago
  From the ruling, p. 62: "In sum, our assessment is as follows. The trial court found that rectifying the various forms of irreparable harm shown by the People more strongly serves the public interest than protecting Uber, Lyft, their shareholders, and all of those who have come to rely on the advantages of online ride-sharing delivered by a business model that does not provide employment benefits to drivers." Reporters simply paraphrased the court's opinion.
umvi 6y ago
So does this mean it'll be more economical for me to just rent cars again and drive myself whenever I fly to California?
- josh2600 6y ago
  I always say this whenever this comes up, but, the number of duis since Uber has been operating have dropped precipitously. I don’t want to be on California roads late at night without Uber.
  - Larrikin 6y ago
    I don't care if uber can't pay back their VCs and goes under because of this ruling. There is a model that has shown to have a service people want and are willing to pay for, the market will find the right price with a different company. Drunk driving reduction has been a good thing about these services, but it doesn't need to be uber.
    - foota 6y ago
      It could be that the market won't exist (or that the quality of service will diminish because of the lower network effects) if there isn't sufficient demand at a break even price post legislation.
      - VRay 6y ago
        I'll bet you could set up an actual marketplace with automated matchmaking it probably wouldn't be as good as Uber/Lyft can make things by forcing "contractors" to take unprofitable rides, though
        koolba 6y ago
        And then you’re back to the NYC pre-2009 model where you can get a cab anywhere in Manhattan but good luck getting home from Bushwick.
tomerico 6y ago
Ironically, this is likely good news for Uber & Lyft. It makes Prop 22 more important, and makes the effects of not having it more real.
- not2b 6y ago
  It doesn't make a difference. AB5 is the law; it was on hold until the outcome of prop 22. With or without this court decision, if 22 doesn't win Uber and Lyft either have to reclassify their drivers or their drivers will work for some other company that is willing to comply. What is not a possibility is that app-based ride applications will disappear. There's a market, people want the service, and the current drivers want to provide it.
ChuckMcM 6y ago
This has been an interesting battle in terms of civil governance. Basically Uber & Lyft threatened to put the initiative they wrote, on the ballot if the legislature passed AB5, which they did. Uber and Lyft are now doing everything they can to get it to pass which will set up its own court fight. Watching this fight I wonder "Who is in charge of governing California?" is it the Legislature/Governor or is it special interests who can spend enough to put bespoke laws into effect and make bespoke changes to the state constitution? California didn't help itself when it implemented term limits which had the unpleasant side effect of never having any legislators with enough experience in the job to know how to really get things done, and so the "work" of writing laws has also fallen to special interests. This has never been more clear than the last 4 years where California has had a single party in both houses, and a Governor and still cannot legislate anything that special interests oppose. I don't know what the "solution" would be but it does not feel like it is serving the people of California well (as someone who lives here).
- Ericson2314 6y ago
  > California didn't help itself when it implemented term limits which had the unpleasant side effect of never having any legislators with enough experience in the job to know how to really get things done. I've never understood this argument. Potential "yay" and "nay" votes are both term-limited, so the "inexperience" should cancel out? The fear of rocking the boat effects anyone that, well, will live longer. Whether you are looking for continued perks/bribes in office, a cushy lobbying job after, or simply don't want to make enemies before your political next move, the perverse incentives are still there. Perhaps a better thing to do would be to let the populace force votes on a daily basis (with queuing / anti DOS measures, of course), so the representatives have to go on the record one way or another, and can't hide behind inaction.
  - beambot 6y ago
    Yay & Nay votes aren't the only job of legislators. They're often responsible for writing good legislation too -- something that's arguably difficult to do if you're new to the job, so the task (largely) falls back to special interests to "help" with the process. By way of example: Literature. It's easy to read a good book; it's much harder to write one without lots & lots of practice.
not2b 6y ago
If Uber and Lyft don't win their proposition, they can either agree to classify their drivers as employees, or some company that is willing to classify drivers that way will take over the market. People are commenting as if app-based ride share will no longer be available. It might cost more, but it wouldn't be much more.
- Judgmentality 6y ago
  > People are commenting as if app-based ride share will no longer be available. It might cost more, but it wouldn't be much more. Uber lost $8.5 billion dollars in 2019. Think about that. Uber is losing the better part of a billion dollars every month. They are hemmorrhaging money at their current prices. It will cost a lot more for this to be profitable when you consider how much more expensive this will make the drivers.
  - omgwtfbyobbq 6y ago
    A quick search puts them at 6.9 billion rides in 2019, so profitability should come with a $2/ride increase. I think their current rates are a lot, so their current rates plus $2 are also a lot, but I think most riders would tolerate it.
    - Judgmentality 6y ago
      This is ignoring how much more expensive it will be if the drivers are employees. I don't know how much that is, but I'd imagine in addition to those $2 it would likely add another 30% or so to the total cost (someone more knowledgeable please chime in with a better estimate). Of course that's assuming you're operating at Uber's scale (there are still overhead costs), but since prices go up you aren't, so now the prices need to go up even more! I don't know where the equilibrium point is, I just know it's higher than what Uber is charging. My extremely hand-wavy guess is rides would need to cost around 50% more.
      - bufferoverflow 6y ago
hourislate 6y ago
What happens if Uber and Lyft pull out of California? Here is a list of Organizations and Individuals who are against Prop 22 Seems like there are a lot of Unions, School Districts, and every Democrat in Government from Biden all the way to the local level. https://sickofgiggreed.com/endorsements/ https://sickofgiggreed.com/endorsements/
- dybber 6y ago
  If they pull out, some other company willing to abide by the rules will probably appear to fill the gap, with the same service, but in terms where workers aren’t exploited.
  - kmlx 6y ago
    1. workers aren't exploited :))) 2. cab companies already exist. no one uses them.
cm2012 6y ago
Incredibly dumb. Taxi drivers have not ever been employees, what's the difference now?
- youeseh 6y ago
  The difference is in the power imbalance. Taxi drivers hold much more power and control over their ability to earn compared to Uber and Lyft drivers.
  - johnloeber 6y ago
    No they don't. Taxi drivers are exploited end-to-end. There's a reason why the medallions eclipsed a million dollars in price. The drivers have to lease their cars on a daily basis, and start at around $160 leasing fee in the hole. They're driving for many hours before they start making any money at all. That's not "power and control", that's getting totally screwed. And every Uber or Lyft driver who has ever driven taxis before will tell you that.
    - dudus 6y ago
      Just because taxi drivers were exploited it doesn't mean Uber drivers aren't. They are exploited in different ways.
    - whyenot 6y ago
      I don't know about other major cities in California, but in San Francisco, taxi medallions were free until Gavin Newsom decided to "monetize" them in 2010. After that the city sold them for $250,000 each while providing low interest loans (via a local credit union) so drivers could pay for them. When Uber and Lyft arrived, their drivers didn't need medallions and there were no limits on how many drivers either company could have on the street. The medallion system collapsed and those who took out loans for them did indeed end up getting screwed.
      - lostcolony 6y ago
        They were "free", but they've always been supplied lower than demand (that is, the number of permits grew slower than the population's need for taxis did), an arrangement that worked well for cab drivers since it allowed less competition, and a profitable secondary market for the medallions. Lyft/Uber/etc gutted that demand. Not saying 'good' or 'bad', just, you can't blame the city for the price of the medallion; it already had a high one due to the demand outstripping the supply. Makes sense that the government would seek to profit when it supplies them, given that.
haroldegibbons 6y ago
This ruling could pave the way for a model that is good for everyone. As of now the gig economy exploits the poor[0]. Unless you think making 70% less than minimum wage is fair. 0: https://web.archive.org/web/20180302041610/http://ceepr.mit.edu/files/papers/2018-005-Brief.pdf https://web.archive.org/web/20180302041610/http://ceepr.mit....
- dpc_pw 6y ago
  Is not being able to work for Uber and being unemployed more fair? Or do you or California's government have any more fair deal to offer these people?
  - randmeerkat 6y ago
    These zero sum arguments are pointless and needlessly inflammatory.
    - s17n 6y ago
      That's exactly what's going to happen, though. Uber and Lyft are not very profitable so they can't actually afford to increase wages or benefits out of their own pockets. If they increase prices, the market will shrink, so drivers won't have work.
  - dybber 6y ago
    That’s not the alternative scenario. The alternative scenario is that either Uber/Lyft or another company abides by the rules, and deliver the same service with hired employees. The demand is there. Yes, it will become a bit more expensive for the consumer, but that price difference, is what it costs to give decent benefits and rights to workers.
    - brian_cloutier 6y ago
      Your alternative scenario isn't entirely correct either. Yes, the workers you see will be paid more and they will appreciate the labor protections. However, there will be a number of people whom you will not see, because they will no longer be employed at all.
ablanco 6y ago
I think Uber/lyft thought that self driving cars would arrive earlier than these regulations. Now they have to face a great difficulty to adapt to the new environment
- derwiki 6y ago
  It’s a little off topic, but today you can get a self driving ride in Las Vegas through the Lyft app. Two safety drivers sit up front though so it’s not driverless.
dybber 6y ago
Important victory for workers everywhere. Drivers is only one if the first areas where gig companies tries to avoid rules and regulation on worker protection, rights and benefits, by making employees into contractors. I hope we can get similar legislation introduced here in Denmark.
- kmlx 6y ago
  the only organisations who won are the unions. workers lost out, the clients lost out, uber/lyft lost out. in any case i don't think anyone was looking at california for their laws :))
syntaxing 6y ago
This has always been an interesting discussion morally. On one side, our free market should be able to allow any drivers to not work for any ride sharing company if they choose not to. On the other hand, the question I haven't been able to answer is if they truly have viable options or if the workers understand they are making under minimum wage. It's hard to balance between the freedom of choice and regulations to protect the people. At one point we (as in the US) decided child labor is unacceptable at the expense of household income dropping for the benefit of the future. Likewise, how much regulation are we willing to impose on the private market for the benefit of the workers and are there national growth consequences. I'm not sure how this will play out but it will be interesting to see.
- ChicagoDave 6y ago
  Except what all the employment hawks ignore is that 70% of ride-share drivers don’t want to be employees. Number one concern is pay. Number two is autonomy. Benefits aren’t even a consideration. This whole thing is about lawyers and the taxi industry. It’s bullshit. Uber is far from perfect, but let’s make sure we raise every point when arguing about it.
  - jimnotgym 6y ago
    >70% of ride-share drivers don't want to be employees Firstly, is that backed up by data? Secondly, what is their reason for not wanting to be employees? Is it something about immigration law, exploitative employers or truly something about freedom?
    - ChicagoDave 6y ago
      Yep. https://therideshareguy.com/uber-driver-survey/ https://therideshareguy.com/uber-driver-survey/ Why is it so hard to believe drivers enjoy their freedom? They get to control their schedule. Turn the app on and off. Quit after two rides or drive for ten hours because the hits keep coming. This is not exploitation. There’s a small number of drivers taking advantage of free lawyers backed by the taxi industry. But more than anything. If you don’t like ride share don’t drive for ride share. Find a different job. Who said anyone has a right to demand a job to be created their way? Ride share works as it is. If you want a full-time with benefits go get a trucking job. There are a ton of those.
donor20 6y ago
AB5 has been a total disaster. The number of special cased carve-outs is ridiculous - it's not a normal law. Obviously AB5 was hacked together by some special interests (unions maybe - what is history?). It's totally unworkable. The carveouts that keep coming are the sign of this - how many are there now, anyone have the list? And yes, I'm a maxed out dem donor. If AB5 is the way workers rights are going to be advanced we are hosed. I can think of 5 much easier, fairer, high impact approaches.
- azinman2 6y ago
  What would they be?
- akiselev 6y ago
  > The number of special cased carve-outs is ridiculous - it's not a normal law. I looked up AB5 [1] and read about the "carve outs" last time the topic came up, among several other. It's far shorter than other nontrivial bills and I couldn't find a single one that didn't specifically mention a superseding precedent or specialized State or Federal law that had supremacy regardless. For example, the primary exceptions are driven by the Borello test from Borello & Sons, Inc. v. Dept. of Industrial Relations which is a California supreme court decision [2], the interaction between California and Federal fishing regulations [3], and a vast array of past state and federal regulations written for licensed professionals like lawyers, doctors, and even commercial truck drivers [4]. [1] https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB5 https://leginfo.legislature.ca.gov/faces/billTextClient.xhtm... [2] (c) (1) Subdivision (a) and the holding in Dynamex do not apply to a contract for “professional services” as defined below, and instead the determination of whether the individual is an employee or independent contractor shall be governed by Borello if the hiring entity demonstrates that all of the following factors are satisfied: ... [3] (ii) “Commercial fisherman” means a person who has a valid, unrevoked commercial fishing license issued pursuant to Article 3 (commencing with Section 7850) of Chapter 1 of Part 3 of Division 6 of the Fish and Game Code. ... (C) On or before March 1, 2021, and each March 1 thereafter, the Employment Development Department shall issue an annual report to the Legislature on the use of unemployment insurance in the commercial fishing industry. This report shall include, but not be limited to, reporting the number of commercial fishermen who apply for unemployment insurance benefits, the number of commercial fishermen who have their claims disputed, the number of commercial fishermen who have their claims denied, and the number of commercial fishermen who receive unemployment insurance benefits. The report required by this subparagraph shall be submitted in compliance with Section 9795 of the Government Code. [4] (8) (A) Paragraph (2) shall not apply to a subcontractor providing construction trucking services for which a contractor’s license is not required by Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, provided that all of the following criteria are satisfied ...
deepsun 6y ago
I remember FedEx was forced to reclassify it's delivery contractors as employees. Why Uber and Lyft any different than FedEx?
- fairity 6y ago
  Some differences that come to mind: no scheduled shifts, no uniform, much less control over how workers service customers, ability to set your own rate. I'm sure there are more.
  - duhast 6y ago
    What difference does the uniform make?
okareaman 6y ago
As a retired programmer who drives Lyft/Uber, it's always interesting to hear my liberal programmer friends take the side of the "working class" drivers against the Big Brother-ish Big Tech companies. I might have been one of them in the past. I'll probably be one of them in the future when self-driving cars replace drivers. But for now... Most of the drivers who don't make enough money are bad at their job. California unions are encouraging these bad drivers to seek protection. I base this on talking to other drivers and taking rides myself. How is a driver bad at their job? * won't do rides out of town because "I don't get paid coming back" * won't do rides to the airport * declines short rides * won't get out of the car to help people put things or groceries in the trunk * has a "my car, my rules" attitude. Won't allow drinks for example * won't turn the radio down when someone gets a call * male drivers bothering women who just want to get somewhere * misses turns frequently * talks whether the passenger wants it or not * won't talk if passenger clearly wants to talk * takes eyes off the road while talking * fiddles with their cell phone while driving to look at texts * goes too fast, tailgates, lousy driver * talks politics, religion or sex * has a body odor problem. doesn't use air freshener in car or shower before driving. * has a dirty car * won't take a different route if asked, or alternately, goes off route without explanation * won't wait the require 5 minutes to pick someone up * accepts a ride and then calls to see where they are going. cancels if they don't like it (Lyft) * won't put on air conditioner when asked I could go on, but these drivers don't get tips and don't make enough money from rides because they are not maximizing potential. Up to 70% of drivers are like me and do a good job, like the freedom to work when and where they want, and would like you to vote yes on Prop 22 if you are in California. Thanks
- lisper 6y ago
  And how can we know that you're not a shill?
  - jayd16 6y ago
    Cursory glance at the comment history seems to argue otherwise, no?
    - 6y ago
cft 6y ago
The article states "The case emerged after California implemented a law, known as AB5, aimed at reclassifying ride-hail, food delivery and other app-based workers as employees entitled to benefits such as unemployment insurance and minimum wage." What's relevant for HN is that this is not the full list: if you are a freelancer, or if you are a company that hired California freelancers, you are out of business in California.
schalab 6y ago
Lets say I have a club I own, but I need to keep the riff raff out. I cant openly ban poor or low society people from entering which would be considered "evil". But what if I mandated every service from a staff must be tipped with atleast 100$, because we value our workers more here. This achieves the same purpose and I get to pretend to be egalitarian. If this law is passed, ride sharing apps will still exist. They will have a smaller roster of higher quality of drivers and be more expensive to use. It will be perfectly fine for most of the people commenting here. Who it will destroy is the "riff raff", the people at the lowest rungs of the ladder on both ends. Those who cannot contribute work of sufficient quality to be paid for full time work and benefits. And those who cant afford more expensive ride sharing. Basically a way to ask people of a certain level to leave the state because they cant participate in the economy anymore and appear compassionate at the same time. Insidiously genius.
- auggierose 6y ago
  "ride sharing" is not how people use it. People use it as a cab.
  - bufferoverflow 6y ago
    And it doesn't matter. Now it's a fully consensual relationship between Uber and the driver (and the customer), where everyone involved agrees to the terms voluntarily. The law changes that, and will simply result in the loss of jobs.
    - benjaminjosephw 6y ago
      How much choice do the drivers have if that's where all the customers are? It sounds to me like you're confusing the willingness of drivers to relent to market forces outside of their control for their consent. Some are definitely happier than others but none have the degree of agency you seem to suggest they do.
    - La1n 6y ago
      And someone can consent to working in a chemical plant without protection but OSHA won't let that happen. Worker rights need to be protected by law, or it is a race to the bottom for the working conditions of the poorest.
LatteLazy 6y ago
I think one upside to this ruling is that we will finally see whether the employee model is actually workable or not.
vadym909 6y ago
I really don't get why these companies are so resistant to make them employees. No one can force them to pay rich benefits. Employer taxes only cost 10%. If Walmart, Starbucks, Chipotle, Amazon can do it so can they.
- mepiethree 6y ago
  Wow, until reading this comment, I had never really thought about the fact that Uber is claiming they'll go out of business if they're required to give WALMART-level worker protections. race to the bottom...
02020202 6y ago
this is great news! i can't wait for self-driving cars to replace these mouth-breathing morons. automation ftw.
laughingman2 6y ago
If uber/lyft doesn't allow their drivers to price themselves and not treat them as employers, they are more or less a cartel rather than a marketplace connecting buyers and sellers of a service. Maybe they can show a optimal price and allow drivers to change that and charge drivers for the customers they get from the platform.
thefounder 6y ago
This is a bit off topic but should be expect the same regulatory dance with Airbnb after IPO?
xenadu02 6y ago
Would this even be a problem if we didn't tie benefits like healthcare to employment? It certainly would take a lot of the administrative burden off startups and free up more people to consider starting or joining one if healthcare weren't at risk.
OJFord 6y ago
Don't drivers decide when to work, just open the app and login or whatever and start driving? IANAL and have UK perspective (and AFAIK they remain independent contractors here, but I'm not sure if it's settled) but to me, (IANAJudge though..) that's a sufficient test for the difference between zero hours contract employee and independent. They're not getting given their hours for the week (right?) they're just showing up and working.
- mepiethree 6y ago
  It's not necessarily obvious, but the legal definition of an employee in CA has little to do with whether or not you pick your hours. According to dynamax, an independent contractor must: - be free from the control of the employer AND - be performing work that is unrelated to the company's core business AND - have an independent career in the field of the work they perform https://www.labor.ca.gov/employmentstatus/abctest/ https://www.labor.ca.gov/employmentstatus/abctest/ Uber drivers generally meet none of these three requirements
habosa 6y ago
Regardless of how you feel about AB5, you should vote No on Prop 22 for one reason: > Amending Proposition 22 would require a seven-eights (87.5%) vote in each chamber of the California State Legislature and the governor's signature, provided that the amendment is consistent with, and furthers the purpose of, Proposition 22. Changes that are not considered consistent with, and furthering the purpose of, Proposition 22 would need voter approval [0] This means if the law passes with a simple majority, any future amendments require 87.5% of the legislature which is basically impossible. This proposition re-writes the democratic process, not just the law. It manes Uber and Lyft get to decide not only what the law is today but how it evolves forever. That's not how democracy should work and we should not pass this prop. If you believe drivers should be contractors, fine, but let's not hand over the government over that point. [0]: https://ballotpedia.org/California_Proposition_22,_App-Based_Drivers_as_Contractors_and_Labor_Policies_Initiative_(2020) https://ballotpedia.org/California_Proposition_22,_App-Based...
- rrss 6y ago
  This is an inaccurate take. The default for an approved CA ballot initiative is that it cannot be amended or repealed by the state legislature. Normally changing a ballot initiative requires another ballot proposition, so an initiative permitting the legislature to make changes with a seven-eighths vote is actually more amenable to changes than normal, not less. The California Constitution has a clause that enables initiatives to determine whether they can be changed by the state legislature. You may argue that this is weird, but it's how ballot initiatives work in California, so this one isn't rewriting the democratic process. https://ballotpedia.org/Legislative_alteration https://ballotpedia.org/Legislative_alteration
  - habosa 6y ago
    Huh I did not know that and I guess most news outlets don’t either! One more reason why voters can’t really be expected to make the right decision on 40 ballot measures.
40four 6y ago
I think it's safe to say many Californians should start preparing for life without ride-share. Assuming Prop 22 does not pass, the most likely outcome seems to be Uber and Lyft will simply shut down operations for the time being, if not for good. They have already signaled they are willing to do this before this appeal, and they are explicitly saying this is the most likely outcome in the media. The philosophies of both sides have been debated ad nauseam. Regardless of what side you take, the reality is these new regulations are effectively going to get many drivers 'fired'. I don't hear much discussion about this. It seems folks on the side of making them employees can't imagine a world where Uber and Lyft will simply shut down. Of course, those who are anti prop-22 have the drivers best interests in mind, but nobody's lives will be improved if they are denied the ability to work at all. We have to take that into account. What happens when 22 fails, and all those drivers are out of work? What happens when millions of users who are used to being able to dial up fast, affordable rides on the drop of a hat, suddenly lose this ability? It's going to be painful for all parties involved.
- User23 6y ago
  They should just shut down now and then those pained parties will vote for 22.
  - 40four 6y ago
    I don't live in California, but If I remember, Uber actually did shut down briefly while they were filling this appeal?
- mepiethree 6y ago
  What happens? Either a) uber backs down from their bluff, and actually pays people, or b) a new company will fill the void, or c) uber lays off more of its bloated white collar workforce who provide little marginal value to the consumer It is incredibly alarmist to say that we won't be able to use an app to hail a ride anymore.
zalkota 6y ago
Reason 1037393 to leave California!
PostThisTooFast 6y ago
This ruling seems ridiculous. On what grounds did the court reject the assertion that these drivers are contractors?
andrethegiant 6y ago
So what did we just vote on then? Does this invalidate/override prop 22?
tyrex2017 6y ago
Subjectively comparing to other threads, this thread has 2 standard deviations more pro-Uber comments than would be normal for such a thread. I would bet 2.5 to 1.5 that Uber PR is at work here :)

357 points by BigBalli 6y ago

> Remedying those harms more strongly served the public interest I hate reporters using this language to describe court opinions. It’s a legal term of art that makes decisions sound political. The judge ruled based on the law. Lawmakers balance public interest. Yes, the court furthers that through its work, but it isn’t actively creating the scales by which to weigh these parties’ interests.

deleted 6y ago
[deleted]
drewblaisdell 6y ago
> The judge ruled based on the law. Are you basing this on anything other than the ideal that we Americans are taught about how courts work? In practice, a reasoned argument can be made for two or more interpretations of law and judges are often entirely "political".
- pmiller2 6y ago
  "Judges rule based on the law," and "judges' decisions are inherently political" are not inconsistent statements. In other words, why not both?
- not2b 6y ago
  AB5 was very clear about how Uber and Lyft drivers should be classified. There wasn't any ambiguity and it wasn't a hard case. If Prob 22 wins, then that part of AB5 is overruled. If not, drivers are employees entitled to minimum wage and everything else employees are entitled to.
  - gnopgnip 6y ago
    And AB5 was just clarifying what the law after Dynamex v. Superior Court
- rectang 6y ago
  One of the great distinctions between natural languages and programming languages is that programming languages have comparatively little ambiguity — because computers do not have the capacity to consider external context when interpreting the intention of the programmer, and thus cannot resolve ambiguous constructs. You'd hope that tech folks, from constantly having to accommodate this defect of computers, would develop a sophisticated appreciation for ambiguity. Instead, it seems that the ability to appreciate nuance atrophies. Legal language may be more formalized than everyday language, but there is still lots and lots of ambiguity. The idea that there is a single correct interpretation of "the law" is nothing more than collective self-deception.
  - thelastbender12 6y ago
    The distinction between natural language and programming languages is interesting, given the push towards machine learning and programming 2.0 that switches explicit instructions in code for training using examples.
moioci 6y ago
From the ruling, p. 62: "In sum, our assessment is as follows. The trial court found that rectifying the various forms of irreparable harm shown by the People more strongly serves the public interest than protecting Uber, Lyft, their shareholders, and all of those who have come to rely on the advantages of online ride-sharing delivered by a business model that does not provide employment benefits to drivers." Reporters simply paraphrased the court's opinion.

umvi 6y ago

So does this mean it'll be more economical for me to just rent cars again and drive myself whenever I fly to California?

josh2600 6y ago
I always say this whenever this comes up, but, the number of duis since Uber has been operating have dropped precipitously. I don’t want to be on California roads late at night without Uber.
- Larrikin 6y ago
  I don't care if uber can't pay back their VCs and goes under because of this ruling. There is a model that has shown to have a service people want and are willing to pay for, the market will find the right price with a different company. Drunk driving reduction has been a good thing about these services, but it doesn't need to be uber.
  - foota 6y ago
    It could be that the market won't exist (or that the quality of service will diminish because of the lower network effects) if there isn't sufficient demand at a break even price post legislation.
    - VRay 6y ago
      I'll bet you could set up an actual marketplace with automated matchmaking it probably wouldn't be as good as Uber/Lyft can make things by forcing "contractors" to take unprofitable rides, though
      - koolba 6y ago
        And then you’re back to the NYC pre-2009 model where you can get a cab anywhere in Manhattan but good luck getting home from Bushwick.

tomerico 6y ago

Ironically, this is likely good news for Uber & Lyft. It makes Prop 22 more important, and makes the effects of not having it more real.

not2b 6y ago
It doesn't make a difference. AB5 is the law; it was on hold until the outcome of prop 22. With or without this court decision, if 22 doesn't win Uber and Lyft either have to reclassify their drivers or their drivers will work for some other company that is willing to comply. What is not a possibility is that app-based ride applications will disappear. There's a market, people want the service, and the current drivers want to provide it.

ChuckMcM 6y ago

This has been an interesting battle in terms of civil governance. Basically Uber & Lyft threatened to put the initiative they wrote, on the ballot if the legislature passed AB5, which they did. Uber and Lyft are now doing everything they can to get it to pass which will set up its own court fight. Watching this fight I wonder "Who is in charge of governing California?" is it the Legislature/Governor or is it special interests who can spend enough to put bespoke laws into effect and make bespoke changes to the state constitution? California didn't help itself when it implemented term limits which had the unpleasant side effect of never having any legislators with enough experience in the job to know how to really get things done, and so the "work" of writing laws has also fallen to special interests. This has never been more clear than the last 4 years where California has had a single party in both houses, and a Governor and still cannot legislate anything that special interests oppose. I don't know what the "solution" would be but it does not feel like it is serving the people of California well (as someone who lives here).

Ericson2314 6y ago
> California didn't help itself when it implemented term limits which had the unpleasant side effect of never having any legislators with enough experience in the job to know how to really get things done. I've never understood this argument. Potential "yay" and "nay" votes are both term-limited, so the "inexperience" should cancel out? The fear of rocking the boat effects anyone that, well, will live longer. Whether you are looking for continued perks/bribes in office, a cushy lobbying job after, or simply don't want to make enemies before your political next move, the perverse incentives are still there. Perhaps a better thing to do would be to let the populace force votes on a daily basis (with queuing / anti DOS measures, of course), so the representatives have to go on the record one way or another, and can't hide behind inaction.
- beambot 6y ago
  Yay & Nay votes aren't the only job of legislators. They're often responsible for writing good legislation too -- something that's arguably difficult to do if you're new to the job, so the task (largely) falls back to special interests to "help" with the process. By way of example: Literature. It's easy to read a good book; it's much harder to write one without lots & lots of practice.

not2b 6y ago

If Uber and Lyft don't win their proposition, they can either agree to classify their drivers as employees, or some company that is willing to classify drivers that way will take over the market. People are commenting as if app-based ride share will no longer be available. It might cost more, but it wouldn't be much more.

Judgmentality 6y ago
> People are commenting as if app-based ride share will no longer be available. It might cost more, but it wouldn't be much more. Uber lost $8.5 billion dollars in 2019. Think about that. Uber is losing the better part of a billion dollars every month. They are hemmorrhaging money at their current prices. It will cost a lot more for this to be profitable when you consider how much more expensive this will make the drivers.
- omgwtfbyobbq 6y ago
  A quick search puts them at 6.9 billion rides in 2019, so profitability should come with a $2/ride increase. I think their current rates are a lot, so their current rates plus $2 are also a lot, but I think most riders would tolerate it.
  - Judgmentality 6y ago
    This is ignoring how much more expensive it will be if the drivers are employees. I don't know how much that is, but I'd imagine in addition to those $2 it would likely add another 30% or so to the total cost (someone more knowledgeable please chime in with a better estimate). Of course that's assuming you're operating at Uber's scale (there are still overhead costs), but since prices go up you aren't, so now the prices need to go up even more! I don't know where the equilibrium point is, I just know it's higher than what Uber is charging. My extremely hand-wavy guess is rides would need to cost around 50% more.
    - bufferoverflow 6y ago

hourislate 6y ago

What happens if Uber and Lyft pull out of California? Here is a list of Organizations and Individuals who are against Prop 22 Seems like there are a lot of Unions, School Districts, and every Democrat in Government from Biden all the way to the local level. https://sickofgiggreed.com/endorsements/ https://sickofgiggreed.com/endorsements/

dybber 6y ago
If they pull out, some other company willing to abide by the rules will probably appear to fill the gap, with the same service, but in terms where workers aren’t exploited.
- kmlx 6y ago
  1. workers aren't exploited :))) 2. cab companies already exist. no one uses them.

cm2012 6y ago

Incredibly dumb. Taxi drivers have not ever been employees, what's the difference now?

youeseh 6y ago
The difference is in the power imbalance. Taxi drivers hold much more power and control over their ability to earn compared to Uber and Lyft drivers.
- johnloeber 6y ago
  No they don't. Taxi drivers are exploited end-to-end. There's a reason why the medallions eclipsed a million dollars in price. The drivers have to lease their cars on a daily basis, and start at around $160 leasing fee in the hole. They're driving for many hours before they start making any money at all. That's not "power and control", that's getting totally screwed. And every Uber or Lyft driver who has ever driven taxis before will tell you that.
  - dudus 6y ago
    Just because taxi drivers were exploited it doesn't mean Uber drivers aren't. They are exploited in different ways.
  - whyenot 6y ago
    I don't know about other major cities in California, but in San Francisco, taxi medallions were free until Gavin Newsom decided to "monetize" them in 2010. After that the city sold them for $250,000 each while providing low interest loans (via a local credit union) so drivers could pay for them. When Uber and Lyft arrived, their drivers didn't need medallions and there were no limits on how many drivers either company could have on the street. The medallion system collapsed and those who took out loans for them did indeed end up getting screwed.
    - lostcolony 6y ago
      They were "free", but they've always been supplied lower than demand (that is, the number of permits grew slower than the population's need for taxis did), an arrangement that worked well for cab drivers since it allowed less competition, and a profitable secondary market for the medallions. Lyft/Uber/etc gutted that demand. Not saying 'good' or 'bad', just, you can't blame the city for the price of the medallion; it already had a high one due to the demand outstripping the supply. Makes sense that the government would seek to profit when it supplies them, given that.

haroldegibbons 6y ago

This ruling could pave the way for a model that is good for everyone. As of now the gig economy exploits the poor[0]. Unless you think making 70% less than minimum wage is fair. 0: https://web.archive.org/web/20180302041610/http://ceepr.mit.edu/files/papers/2018-005-Brief.pdf https://web.archive.org/web/20180302041610/http://ceepr.mit....

dpc_pw 6y ago
Is not being able to work for Uber and being unemployed more fair? Or do you or California's government have any more fair deal to offer these people?
- randmeerkat 6y ago
  These zero sum arguments are pointless and needlessly inflammatory.
  - s17n 6y ago
    That's exactly what's going to happen, though. Uber and Lyft are not very profitable so they can't actually afford to increase wages or benefits out of their own pockets. If they increase prices, the market will shrink, so drivers won't have work.
- dybber 6y ago
  That’s not the alternative scenario. The alternative scenario is that either Uber/Lyft or another company abides by the rules, and deliver the same service with hired employees. The demand is there. Yes, it will become a bit more expensive for the consumer, but that price difference, is what it costs to give decent benefits and rights to workers.
  - brian_cloutier 6y ago
    Your alternative scenario isn't entirely correct either. Yes, the workers you see will be paid more and they will appreciate the labor protections. However, there will be a number of people whom you will not see, because they will no longer be employed at all.

ablanco 6y ago

I think Uber/lyft thought that self driving cars would arrive earlier than these regulations. Now they have to face a great difficulty to adapt to the new environment

derwiki 6y ago
It’s a little off topic, but today you can get a self driving ride in Las Vegas through the Lyft app. Two safety drivers sit up front though so it’s not driverless.

dybber 6y ago

Important victory for workers everywhere. Drivers is only one if the first areas where gig companies tries to avoid rules and regulation on worker protection, rights and benefits, by making employees into contractors. I hope we can get similar legislation introduced here in Denmark.

kmlx 6y ago
the only organisations who won are the unions. workers lost out, the clients lost out, uber/lyft lost out. in any case i don't think anyone was looking at california for their laws :))

syntaxing 6y ago

This has always been an interesting discussion morally. On one side, our free market should be able to allow any drivers to not work for any ride sharing company if they choose not to. On the other hand, the question I haven't been able to answer is if they truly have viable options or if the workers understand they are making under minimum wage. It's hard to balance between the freedom of choice and regulations to protect the people. At one point we (as in the US) decided child labor is unacceptable at the expense of household income dropping for the benefit of the future. Likewise, how much regulation are we willing to impose on the private market for the benefit of the workers and are there national growth consequences. I'm not sure how this will play out but it will be interesting to see.

ChicagoDave 6y ago
Except what all the employment hawks ignore is that 70% of ride-share drivers don’t want to be employees. Number one concern is pay. Number two is autonomy. Benefits aren’t even a consideration. This whole thing is about lawyers and the taxi industry. It’s bullshit. Uber is far from perfect, but let’s make sure we raise every point when arguing about it.
- jimnotgym 6y ago
  >70% of ride-share drivers don't want to be employees Firstly, is that backed up by data? Secondly, what is their reason for not wanting to be employees? Is it something about immigration law, exploitative employers or truly something about freedom?
  - ChicagoDave 6y ago
    Yep. https://therideshareguy.com/uber-driver-survey/ https://therideshareguy.com/uber-driver-survey/ Why is it so hard to believe drivers enjoy their freedom? They get to control their schedule. Turn the app on and off. Quit after two rides or drive for ten hours because the hits keep coming. This is not exploitation. There’s a small number of drivers taking advantage of free lawyers backed by the taxi industry. But more than anything. If you don’t like ride share don’t drive for ride share. Find a different job. Who said anyone has a right to demand a job to be created their way? Ride share works as it is. If you want a full-time with benefits go get a trucking job. There are a ton of those.

donor20 6y ago

AB5 has been a total disaster. The number of special cased carve-outs is ridiculous - it's not a normal law. Obviously AB5 was hacked together by some special interests (unions maybe - what is history?). It's totally unworkable. The carveouts that keep coming are the sign of this - how many are there now, anyone have the list? And yes, I'm a maxed out dem donor. If AB5 is the way workers rights are going to be advanced we are hosed. I can think of 5 much easier, fairer, high impact approaches.

azinman2 6y ago
What would they be?
akiselev 6y ago
> The number of special cased carve-outs is ridiculous - it's not a normal law. I looked up AB5 [1] and read about the "carve outs" last time the topic came up, among several other. It's far shorter than other nontrivial bills and I couldn't find a single one that didn't specifically mention a superseding precedent or specialized State or Federal law that had supremacy regardless. For example, the primary exceptions are driven by the Borello test from Borello & Sons, Inc. v. Dept. of Industrial Relations which is a California supreme court decision [2], the interaction between California and Federal fishing regulations [3], and a vast array of past state and federal regulations written for licensed professionals like lawyers, doctors, and even commercial truck drivers [4]. [1] https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200AB5 https://leginfo.legislature.ca.gov/faces/billTextClient.xhtm... [2] (c) (1) Subdivision (a) and the holding in Dynamex do not apply to a contract for “professional services” as defined below, and instead the determination of whether the individual is an employee or independent contractor shall be governed by Borello if the hiring entity demonstrates that all of the following factors are satisfied: ... [3] (ii) “Commercial fisherman” means a person who has a valid, unrevoked commercial fishing license issued pursuant to Article 3 (commencing with Section 7850) of Chapter 1 of Part 3 of Division 6 of the Fish and Game Code. ... (C) On or before March 1, 2021, and each March 1 thereafter, the Employment Development Department shall issue an annual report to the Legislature on the use of unemployment insurance in the commercial fishing industry. This report shall include, but not be limited to, reporting the number of commercial fishermen who apply for unemployment insurance benefits, the number of commercial fishermen who have their claims disputed, the number of commercial fishermen who have their claims denied, and the number of commercial fishermen who receive unemployment insurance benefits. The report required by this subparagraph shall be submitted in compliance with Section 9795 of the Government Code. [4] (8) (A) Paragraph (2) shall not apply to a subcontractor providing construction trucking services for which a contractor’s license is not required by Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, provided that all of the following criteria are satisfied ...

deepsun 6y ago

I remember FedEx was forced to reclassify it's delivery contractors as employees. Why Uber and Lyft any different than FedEx?

fairity 6y ago
Some differences that come to mind: no scheduled shifts, no uniform, much less control over how workers service customers, ability to set your own rate. I'm sure there are more.
- duhast 6y ago
  What difference does the uniform make?

okareaman 6y ago

As a retired programmer who drives Lyft/Uber, it's always interesting to hear my liberal programmer friends take the side of the "working class" drivers against the Big Brother-ish Big Tech companies. I might have been one of them in the past. I'll probably be one of them in the future when self-driving cars replace drivers. But for now... Most of the drivers who don't make enough money are bad at their job. California unions are encouraging these bad drivers to seek protection. I base this on talking to other drivers and taking rides myself. How is a driver bad at their job? * won't do rides out of town because "I don't get paid coming back" * won't do rides to the airport * declines short rides * won't get out of the car to help people put things or groceries in the trunk * has a "my car, my rules" attitude. Won't allow drinks for example * won't turn the radio down when someone gets a call * male drivers bothering women who just want to get somewhere * misses turns frequently * talks whether the passenger wants it or not * won't talk if passenger clearly wants to talk * takes eyes off the road while talking * fiddles with their cell phone while driving to look at texts * goes too fast, tailgates, lousy driver * talks politics, religion or sex * has a body odor problem. doesn't use air freshener in car or shower before driving. * has a dirty car * won't take a different route if asked, or alternately, goes off route without explanation * won't wait the require 5 minutes to pick someone up * accepts a ride and then calls to see where they are going. cancels if they don't like it (Lyft) * won't put on air conditioner when asked I could go on, but these drivers don't get tips and don't make enough money from rides because they are not maximizing potential. Up to 70% of drivers are like me and do a good job, like the freedom to work when and where they want, and would like you to vote yes on Prop 22 if you are in California. Thanks

lisper 6y ago
And how can we know that you're not a shill?
- jayd16 6y ago
  Cursory glance at the comment history seems to argue otherwise, no?
  - 6y ago

cft 6y ago

The article states "The case emerged after California implemented a law, known as AB5, aimed at reclassifying ride-hail, food delivery and other app-based workers as employees entitled to benefits such as unemployment insurance and minimum wage." What's relevant for HN is that this is not the full list: if you are a freelancer, or if you are a company that hired California freelancers, you are out of business in California.

schalab 6y ago

Lets say I have a club I own, but I need to keep the riff raff out. I cant openly ban poor or low society people from entering which would be considered "evil". But what if I mandated every service from a staff must be tipped with atleast 100$, because we value our workers more here. This achieves the same purpose and I get to pretend to be egalitarian. If this law is passed, ride sharing apps will still exist. They will have a smaller roster of higher quality of drivers and be more expensive to use. It will be perfectly fine for most of the people commenting here. Who it will destroy is the "riff raff", the people at the lowest rungs of the ladder on both ends. Those who cannot contribute work of sufficient quality to be paid for full time work and benefits. And those who cant afford more expensive ride sharing. Basically a way to ask people of a certain level to leave the state because they cant participate in the economy anymore and appear compassionate at the same time. Insidiously genius.

auggierose 6y ago
"ride sharing" is not how people use it. People use it as a cab.
- bufferoverflow 6y ago
  And it doesn't matter. Now it's a fully consensual relationship between Uber and the driver (and the customer), where everyone involved agrees to the terms voluntarily. The law changes that, and will simply result in the loss of jobs.
  - benjaminjosephw 6y ago
    How much choice do the drivers have if that's where all the customers are? It sounds to me like you're confusing the willingness of drivers to relent to market forces outside of their control for their consent. Some are definitely happier than others but none have the degree of agency you seem to suggest they do.
  - La1n 6y ago
    And someone can consent to working in a chemical plant without protection but OSHA won't let that happen. Worker rights need to be protected by law, or it is a race to the bottom for the working conditions of the poorest.

LatteLazy 6y ago

I think one upside to this ruling is that we will finally see whether the employee model is actually workable or not.

vadym909 6y ago

I really don't get why these companies are so resistant to make them employees. No one can force them to pay rich benefits. Employer taxes only cost 10%. If Walmart, Starbucks, Chipotle, Amazon can do it so can they.

mepiethree 6y ago
Wow, until reading this comment, I had never really thought about the fact that Uber is claiming they'll go out of business if they're required to give WALMART-level worker protections. race to the bottom...

02020202 6y ago

this is great news! i can't wait for self-driving cars to replace these mouth-breathing morons. automation ftw.

laughingman2 6y ago

If uber/lyft doesn't allow their drivers to price themselves and not treat them as employers, they are more or less a cartel rather than a marketplace connecting buyers and sellers of a service. Maybe they can show a optimal price and allow drivers to change that and charge drivers for the customers they get from the platform.

thefounder 6y ago

This is a bit off topic but should be expect the same regulatory dance with Airbnb after IPO?

xenadu02 6y ago

Would this even be a problem if we didn't tie benefits like healthcare to employment? It certainly would take a lot of the administrative burden off startups and free up more people to consider starting or joining one if healthcare weren't at risk.

OJFord 6y ago

Don't drivers decide when to work, just open the app and login or whatever and start driving? IANAL and have UK perspective (and AFAIK they remain independent contractors here, but I'm not sure if it's settled) but to me, (IANAJudge though..) that's a sufficient test for the difference between zero hours contract employee and independent. They're not getting given their hours for the week (right?) they're just showing up and working.

mepiethree 6y ago
It's not necessarily obvious, but the legal definition of an employee in CA has little to do with whether or not you pick your hours. According to dynamax, an independent contractor must: - be free from the control of the employer AND - be performing work that is unrelated to the company's core business AND - have an independent career in the field of the work they perform https://www.labor.ca.gov/employmentstatus/abctest/ https://www.labor.ca.gov/employmentstatus/abctest/ Uber drivers generally meet none of these three requirements

habosa 6y ago

Regardless of how you feel about AB5, you should vote No on Prop 22 for one reason: > Amending Proposition 22 would require a seven-eights (87.5%) vote in each chamber of the California State Legislature and the governor's signature, provided that the amendment is consistent with, and furthers the purpose of, Proposition 22. Changes that are not considered consistent with, and furthering the purpose of, Proposition 22 would need voter approval [0] This means if the law passes with a simple majority, any future amendments require 87.5% of the legislature which is basically impossible. This proposition re-writes the democratic process, not just the law. It manes Uber and Lyft get to decide not only what the law is today but how it evolves forever. That's not how democracy should work and we should not pass this prop. If you believe drivers should be contractors, fine, but let's not hand over the government over that point. [0]: https://ballotpedia.org/California_Proposition_22,_App-Based_Drivers_as_Contractors_and_Labor_Policies_Initiative_(2020) https://ballotpedia.org/California_Proposition_22,_App-Based...

rrss 6y ago
This is an inaccurate take. The default for an approved CA ballot initiative is that it cannot be amended or repealed by the state legislature. Normally changing a ballot initiative requires another ballot proposition, so an initiative permitting the legislature to make changes with a seven-eighths vote is actually more amenable to changes than normal, not less. The California Constitution has a clause that enables initiatives to determine whether they can be changed by the state legislature. You may argue that this is weird, but it's how ballot initiatives work in California, so this one isn't rewriting the democratic process. https://ballotpedia.org/Legislative_alteration https://ballotpedia.org/Legislative_alteration
- habosa 6y ago
  Huh I did not know that and I guess most news outlets don’t either! One more reason why voters can’t really be expected to make the right decision on 40 ballot measures.

40four 6y ago

I think it's safe to say many Californians should start preparing for life without ride-share. Assuming Prop 22 does not pass, the most likely outcome seems to be Uber and Lyft will simply shut down operations for the time being, if not for good. They have already signaled they are willing to do this before this appeal, and they are explicitly saying this is the most likely outcome in the media. The philosophies of both sides have been debated ad nauseam. Regardless of what side you take, the reality is these new regulations are effectively going to get many drivers 'fired'. I don't hear much discussion about this. It seems folks on the side of making them employees can't imagine a world where Uber and Lyft will simply shut down. Of course, those who are anti prop-22 have the drivers best interests in mind, but nobody's lives will be improved if they are denied the ability to work at all. We have to take that into account. What happens when 22 fails, and all those drivers are out of work? What happens when millions of users who are used to being able to dial up fast, affordable rides on the drop of a hat, suddenly lose this ability? It's going to be painful for all parties involved.

User23 6y ago
They should just shut down now and then those pained parties will vote for 22.
- 40four 6y ago
  I don't live in California, but If I remember, Uber actually did shut down briefly while they were filling this appeal?
mepiethree 6y ago
What happens? Either a) uber backs down from their bluff, and actually pays people, or b) a new company will fill the void, or c) uber lays off more of its bloated white collar workforce who provide little marginal value to the consumer It is incredibly alarmist to say that we won't be able to use an app to hail a ride anymore.

zalkota 6y ago

Reason 1037393 to leave California!

PostThisTooFast 6y ago

This ruling seems ridiculous. On what grounds did the court reject the assertion that these drivers are contractors?

andrethegiant 6y ago

So what did we just vote on then? Does this invalidate/override prop 22?

tyrex2017 6y ago

Subjectively comparing to other threads, this thread has 2 standard deviations more pro-Uber comments than would be normal for such a thread. I would bet 2.5 to 1.5 that Uber PR is at work here :)