The controversy over whether a driver using a car service platform is a company employee has been going on for a long time. The US California Parliament passed the new bill on September 10 and 11, which will greatly increase the labor costs of the “zero-employment economy” platforms such as Uber and Lyft, and rewrite their business models. The new case requires that they be listed as employees rather than contractors by those who earn services through the services provided by their platform.
The State Assembly of the State of California passed a new law called Assembly Bill 5 on the 11th with 61 votes in favor and 16 votes against. The state Senate passed the relevant bill on the 10th. It requires platforms such as Uber and Lyft to redefine drivers as employees of the company and take responsibility for their minimum wage, unemployment insurance and paid sick leave.
The bill will enter into force on January 1, 2020, after the signing of California Governor Gavin Newsom. Newham has expressed his support for this law in the past.
Prosecutor Shannon Liss-Riordan said Uber said the new law is not the same as the company, but the California government has passed the Supreme Court and the state’s law stating that the company must pay employees fairly, similar Uber’s employers cannot avoid liability under the law.
Uber’s drivers are currently defined as independent contractors, sometimes referred to as “gig workers.” Uber’s chief legal counsel, Tony West, issued a statement on the 11th that he believes that the test under the bill will not require the company to define the driver as an employee. He said that even if the new case takes effect in January next year, the drivers will not be automatically redefined as employees.