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Much of the focus during and after election night in
Voters in some states opted to decriminalize drug, and Floridians voted to raise the state minimum wage to
Chief among them was Proposition 22, which passed with 55.8 per cent of the vote.
This new law allows technology companies such as
The back story
A coalition of
In the Dynamex case of 2018, the
The worker is free to perform services without the control or direction of the company;
The worker is performing tasks outside the company’s usual activities; and
The worker is engaged in an independently established trade, occupation or business.
It was certain app-based companies could not meet these criteria.
The legislature then passed Assembly Bill 5 in
The state’s new broader interpretation of employment was meant to give app-based and other contract workers access to labour standards protections, such as the minimum wage, as well as other social benefits currently denied to them, such as unemployment insurance and workers compensation. However, the legislation did not grant gig workers the ability to form unions.
The Proposition 22 campaign
“Yes on 22” proved to be the most well-funded ballot initiative in California’s history. Tech companies spent well over
Since 2018, tech companies had been publicly voicing their objections to the Dynamex decision and California’s Assembly Bill 5, with some threatening to leave
So while Assembly Bill 5 is the law of the land for other employers, Proposition 22 exempts the tech giants by setting separate labour standards for app-based workers.
Consequences for tech workers
The companies argue that Proposition 22 will benefit workers by maintaining the supposed flexibility of app-based work while also providing new, modest benefits.
For example, Proposition 22 includes a provision ensuring workers receive 120 per cent of the state minimum wage in
Other benefits included in Proposition 22 dealing with health care, workers compensation and insurance are all much weaker than the protections guaranteed by traditional employment.
Battles over app-based work in
Conflicts over the employment status of app-based workers are not unique to
The company then pulled out of
Before this decision,
At the federal level, the Liberal government has amended the Canada Labour Code to include a “reverse onus clause” requiring federally regulated employers to prove that contractors they engage are properly classified.
Perhaps learning from outcomes in these other jurisdictions, the drafters of Proposition 22 included within the new law a rule requiring seven-eighths of the
What’s driving the growth in app-based work?
Clearly app-based companies are committed to maintaining the “independent contractor” status of their workforce. This is largely because their business model involves competing on the basis of low labour costs achieved through skirting regulations that apply to competitors, such as traditional taxi companies.
However, some contend that there are much deeper forces at play. Economic historian
According to this theory, stubbornly slow growth rates, low productivity growth and depressed demand for labour are translating into a lack of good quality jobs.
Battles over employment classification and labour regulation, while important for improving app-based workers’ immediate conditions of work, ultimately won’t address the underlying dynamics contributing to the growth of gig work and other forms of precarious employment.
More fundamental reforms are needed to generate secure, well-compensated employment. Investment and job creation led by the public sector will be vital to addressing these issues in the future.
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