The city of Los Angeles will conduct a study of how best to write and enforce a minimum wage for drivers who work on the ride-hailing apps Uber and Lyft. A baseline goal of $30/hr. was approved on October 15 and is meant to consist of $15 in wages and another $15 covering expenses such as gas, rental lease, insurance, and vehicle depreciation. In New York City, a baseline of $27.86/hr. has been in effect since February.
Speaking at a rally of several hundred members of the Mobile Workers Alliance outside city hall on the day of the motion, Manuel Ramos explained that each day he drives “more than 10 hours, more than 25 different trips, more than 150 miles. Believe me, it’s all necessary in order to survive and maintain my family. In this city we the drivers sometimes fall short of minimum wage, and day by day the companies try to pay us less even while our expenses rise. We the drivers literally keep the economy of Los Angeles moving. We make it possible for people to go at any hour to any location. We are not demanding anything abnormal, only a just part of what we make possible.”
One enormous benefits of reclassification will be application of the Affordable Care Act mandating a group health insurance pool for workers.
The promised gains for rideshare drivers in Los Angeles come after a groundbreaking, day-long strikes on March 25 and May 8 (see “Uber and Lyft drivers strike against pay cuts,” May-June 2019 N&L), organized by the grassroots union Rideshare Drivers United (RSDU), which made a foothold in Los Angeles in late 2018. Through the popularity of the two strikes it grew to 6000 members by summer. With several caravans to Sacramento and more local actions such as one at Lyft’s Los Angeles headquarters on July 2 (see “Lyft drivers fight for labor rights,” September-October 2019 N&L), RSDU members lobbied state assembly members and the governor for the passage of Assembly Bill 5.
Signed in September and effective next January, AB5 legislates what the state Supreme Court had ordered more than a year prior: Uber/Lyft drivers and most other gig workers on apps are legally defined as employees and not independent contractors. With this, the claim of Uber and Lyft that they are technology companies and not transportation companies has now been twice rejected in California.
A few enormous benefits of reclassification will perhaps be application of the Affordable Care Act mandating a group health insurance pool for workers and the fact that the companies would have to kick in half of FICA taxes (Social Security, Medicare) just like any other employer. As of now, responsibility still falls 100% on gig workers to pay their FICA liability out of their own pockets. Driver members of the RSDU organization could appeal to the National Labor Relations Board for recognition and legal protections.
In September, a lawyer for Uber told the Sacramento Bee that the company would “continue to treat drivers as independent contractors” and was “prepared to fight in court to defend that position to avoid damage to its business model.” Both Uber and Lyft have amassed a $90 million war chest to finance a repeal effort by ballot initiative. As was evident even before drivers were organized and the apps were constantly shuffling and reshuffling per-mile pay and bonus algorithms, Uber’s “business model” has always been finding new ways to shortchange workers.
[dc]“T[/dc]hese companies are predatory, they’re never going to do right by drivers. It’s up to the people and the cities to hold them accountable, just like the city council did here today,” said Eduardo Belalcazar, who drove for Lyft fifteen hours per day while in college. “Like many Latino students in this city, I had to work to maintain myself. The city of L.A. is very expensive place to live, and for my generation it’s even harder. I ended up leasing a car from Lyft and it ended up consuming most of my time. I drove more and more to come up with money to pay my lease. A $30 living wage is going to do so much for people like me and everyone here behind me.”
News & Letters
Buddy Bell serves on the national editorial board for News & Letters. When he isn’t on a writing streak, he spends his days singing, teaching math, and driving for Lyft.