To put a stop to legislation that would transform gig workers from contractors to employees, Uber and Postmates Inc. are scheduled to meet with a federal judge in California to prevent enforcement of the landmark Assembly Bill 5 legislation. Uber contends that reclassifying workers in such as fashion would bring on an additional 20 to 40 percent in labor costs for on-demand firms, Bloomberg reported.
In a court filing, the company reportedly claimed that the legislation would “turn the technological clock backwards by a decade” and leave behind the wealth that on-demand firms made “to protect the old economy from the new.” California contends that the legislation will help to stem the wearing away of the middle class and address the income inequality that has reportedly been worsened by gig firms.
Uber reportedly refers to the legislation as an “irrational, Frankenstein-like statute” that was pieced together to unfairly put gig firms in the crosshairs while leaving out favored sectors. A.B. 5, which was signed by the governor of California last fall, says workers can generally be seen as contractors if they perform duties that don’t fall within a firm’s usual course of business.
In addition, Lyft President John Zimmer has reportedly met with multiple labor leaders in recent months and proposed a compromise, per unnamed sources. Lyft spokesman Adrian Durbin said the firm is “not engaged in any discussions” and is “singularly focused on passing a ballot measure.”
In separate news, a report surfaced in January that Uber was experimenting with a function that allows some drivers in California to set their own rates. Drivers who shuttle passengers from airports in Sacramento, Santa Barbara and Palm Springs can charge as much as five times more than the price set by Uber on the ride.
The fare test, as well as other recent changes, were said to be part of the ridesharing firm’s moves to bolster its case that its drivers should be able to work with some autonomy.