{"id":178816,"date":"2018-08-12T19:19:00","date_gmt":"2018-08-13T00:19:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2018\/08\/12\/silicon-valley-rules-when-the-going-gets-tough-hire-lobbyists\/"},"modified":"2018-08-12T19:19:00","modified_gmt":"2018-08-13T00:19:00","slug":"silicon-valley-rules-when-the-going-gets-tough-hire-lobbyists","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2018\/08\/12\/silicon-valley-rules-when-the-going-gets-tough-hire-lobbyists\/","title":{"rendered":"Silicon Valley Rules: When the Going Gets Tough, Hire Lobbyists"},"content":{"rendered":"

<\/a>In response to a state court ruling saying that workers for Uber, Lyft, Instacart, etc. are employees, the “gig” companies are lobbying for a law change<\/a>.<\/p>\n

They knew that their business plans, which included meticulous tracking of so-called “independent contractors” ran afoul of the law, ignored this, and now they want the law changed to validate their criminality.<\/p>\n

F%$# that.<\/p>\n

These guys, who see themselves as Randian supermen, may not get it, but their businesses are predicated on a subsidy from the rest of society.<\/p>\n

Not having to pay unemployment, workmens comp, foisting liability on underpaid workers, etc. is more than a violation of the law:  It is a subsidy from the rest of us to line their pockets:<\/p>\n

Leading gig economy companies including Uber and Lyft are quietly lobbying California\u2019s top Democrats to override or undermine a court ruling that could make many of their contract workers into employees.<\/p>\n

In April, the California Supreme Court issued a far-reaching ruling which could make it much harder for companies to claim their workforces of independent contractors are not full-fledged employees under the state\u2019s wage laws. Over the months since, business leaders have been pleading their case to state officials including members of Governor Jerry Brown\u2019s cabinet, Brown\u2019s presumed successor Gavin Newsom, and members of the state legislature.<\/p>\n

The business leaders are pushing to blunt the ruling\u2019s impact, either through legislation or through executive action by the governor — moves that would reverberate across the national debate over the rights and roles of workers in the modern gig economy, and what Democrats\u2019 posture toward tech companies should be.<\/span><\/p><\/blockquote>\n

Let me translate the next of bullsh%$ bingo that is coming from the lobbyists:<\/p>\n

An executive at one of the companies behind the push, speaking on condition of anonymity, said that because Brown and Newsom are both pro-tech and pro-worker, they are uniquely positioned to strike a compromise with the potential to be replicated. Forging a balance between the need for flexible, scalable work arrangements and workers\u2019 rights shouldn\u2019t just be left to the courts or calculated based on old models, the executive said.<\/span><\/p><\/blockquote>\n

We broke the law, but let us continue to do so, and we’ll transfer some of our ill-gotten gains to your campaign coffers:  We need your subsidies to survive.<\/p>\n

Mind you they don’t see this as a subsidy, they see it as disruption, but they will have a very tough time competing, and a tougher time raising massive amounts of venture capital, if they have to treat their employees fairly:<\/p>\n

The April ruling in the California case, Dynamex Operations West Inc. v. Superior Court of Los Angeles, established what\u2019s sometimes called an \u201cABC\u201d test for enforcement of the state\u2019s wage laws. Among the key elements of the new standard, which is more stringent than most states\u2019 or the federal government\u2019s, is the determination that people are employees of a company unless they are conducting \u201cwork that is outside the usual course\u201d of the company\u2019s business. For businesses whose core capacity is delivering a service to customers via an army of workers classified as independent contractors, that could be a challenging test to pass.<\/span>

<\/span> The court ruling applied only to California, but companies worry that, along with upending their operations in the nation\u2019s most populous state, it could be a harbinger of things to come elsewhere. The week after the Dynamex decision, U.S. Senator Bernie Sanders introduced a bill — backed by a handful of fellow potential contenders for the Democratic Party\u2019s 2020 presidential nomination — that would make an equivalent ABC test the standard for federal labor laws, like who has the right to unionize.<\/p>\n

\u2026\u2026\u2026<\/p>\n

Leading gig economy companies including Uber and Lyft are quietly lobbying California\u2019s top Democrats to override or undermine a court ruling that could make many of their contract workers into employees.<\/p>\n

In April, the California Supreme Court issued a far-reaching ruling which could make it much harder for companies to claim their workforces of independent contractors are not full-fledged employees under the state\u2019s wage laws. Over the months since, business leaders have been pleading their case to state officials including members of Governor Jerry Brown\u2019s cabinet, Brown\u2019s presumed successor Gavin Newsom, and members of the state legislature.<\/p>\n

The business leaders are pushing to blunt the ruling\u2019s impact, either through legislation or through executive action by the governor — moves that would reverberate across the national debate over the rights and roles of workers in the modern gig economy, and what Democrats\u2019 posture toward tech companies should be.<\/p>\n

\u201cThe magnitude of this issue requires urgent leadership,\u201d nine companies wrote in a July 23 letter reviewed by Bloomberg, which warns of the ruling \u201cstifling innovation and threatening the livelihoods of millions of working Californians\u201d and says that without political intervention it will \u201cdecimate businesses.\u201d The letter was sent on behalf of Uber Technologies Inc., Lyft Inc., Instacart Inc., DoorDash Inc., Postmates Inc., TaskRabbit Inc., Square Inc., Total System Services Inc. and Handy Technologies Inc. It was addressed to the governor\u2019s secretary of labor and cabinet secretary.<\/p>\n

A spokeswoman for the governor\u2019s office declined to comment on whether Brown, whose final term ends in January, was mulling granting the companies\u2019 pleas.<\/p>\n

An executive at one of the companies behind the push, speaking on condition of anonymity, said that because Brown and Newsom are both pro-tech and pro-worker, they are uniquely positioned to strike a compromise with the potential to be replicated. Forging a balance between the need for flexible, scalable work arrangements and workers\u2019 rights shouldn\u2019t just be left to the courts or calculated based on old models, the executive said.<\/p>\n

Spokespeople for Lyft, Handy, TaskRabbit, Square, Postmates and Instacart declined to comment on the companies\u2019 lobbying efforts. DoorDash did not respond to inquiries. Spokespeople for TSYS and Uber referred requests for comment to the California Chamber of Commerce, which has been an outspoken opponent of the new requirements. \u201cIf you have a business model that doesn\u2019t lend itself to the strict structure that an employer-employee relationship dictates,\u201d said the Chamber\u2019s president and CEO Allan Zaremberg, then the ruling \u201cputs you in a situation that it\u2019s almost impossible to continue your business model.\u201d<\/p>\n

Zaremberg declined to comment on the prospect of executive action from the governor\u2019s office, but said the Chamber aims to get a legislative fix introduced and passed by the state\u2019s assembly and senate before the legislative session closes at the end of the month. Without it, he said, workers and companies alike will be \u201chamstrung,\u201d and whole sectors of California\u2019s economy could be in jeopardy. \u201cPeople depend very much now on an on-demand economy,\u201d said Zaremberg. \u201cIn the worst-case scenario, it isn\u2019t a viable business model anymore.\u201d<\/p>\n

The California Labor Federation pledged Sunday to resist the efforts to suspend or reverse the ruling. “With income inequality at an all-time high and millions of working families struggling to survive in this unfair economy, why would our state\u2019s leaders intervene to protect big corporations from paying the wages owed to their workers?” said the group\u2019s legislative director Caitlin Vega.<\/p>\n

Federal and California state laws entitle employees to a suite of rights including minimum wage, overtime pay, protection from sexual harassment, payroll tax contributions from employers and the chance to win collective bargaining. Those perks don\u2019t extend to independent contractors, a category for workers with greater autonomy to choose the terms of their work. The boundary between an employee and a contractor can be fuzzy, though, and is defined differently under different laws. The question of who gets employee protections has been hotly contested in a slew of government agency proceedings and lawsuits around the country, frequently targeting app-based sectors like ride-sharing as well as older industries such as trucking and health care.<\/p>\n

The April ruling in the California case, Dynamex Operations West Inc. v. Superior Court of Los Angeles, established what\u2019s sometimes called an \u201cABC\u201d test for enforcement of the state\u2019s wage laws. Among the key elements of the new standard, which is more stringent than most states\u2019 or the federal government\u2019s, is the determination that people are employees of a company unless they are conducting \u201cwork that is outside the usual course\u201d of the company\u2019s business. For businesses whose core capacity is delivering a service to customers via an army of workers classified as independent contractors, that could be a challenging test to pass.<\/p>\n

The court ruling applied only to California, but companies worry that, along with upending their operations in the nation\u2019s most populous state, it could be a harbinger of things to come elsewhere. The week after the Dynamex decision, U.S. Senator Bernie Sanders introduced a bill — backed by a handful of fellow potential contenders for the Democratic Party\u2019s 2020 presidential nomination — that would make an equivalent ABC test the standard for federal labor laws, like who has the right to unionize.<\/p>\n

Rather than treating that as an idle threat, the U.S. Chamber of Commerce has already been lobbying congressional offices about the bill, according to federal disclosures. In meetings with U.S. Senate staff, business leaders have been emphasizing the downsides of Dynamex\u2019s ABC test, according to a person familiar with the conversations. Getting Democratically controlled California to pump the breaks on its new court-decreed standard could also have a significant impact on national-level discussions.<\/p>\n

In their letter to Governor Brown, the businesses floated options to curtail the ruling\u2019s influence. Those included issuing an executive order barring state agencies from implementing the ABC test, reviving a defunct state commission that could amend it and passing legislation that would suspend it. The companies cite an estimate by the pro-free-market research group R Street Institute that more than 300,000 California workers could be newly considered employees rather than independent contractors due to the ruling. Once the imminent damage from Dynamex is averted, the companies say in the letter, there could be \u201ca robust legislative discussion about how we can collectively invest to protect worker voices and benefits\u201d in the new economy, as well as a \u201cbalanced test\u201d for who is an employee.<\/p>\n

Besides the letter, the companies have also met with the governors\u2019 office to plead their case, according to a person familiar with the matter, who asked not to be identified because the meetings were private. And they have discussed the issue with the Democrats who lead the state\u2019s assembly and senate and with Lieutenant Governor Newsom. Spokespeople for Newsom, Assembly Speaker Anthony Rendon and Senate President Pro Tempore Toni Atkins declined to comment.<\/p>\n

Gig-economy startups aren\u2019t the only companies concerned. The \u201cI\u2019m Independent\u201d Coalition, a project of the California Chamber of Commerce devoted to opposing the ABC test, also counts the Internet Association as a backer. The association\u2019s members include Google, Amazon and Facebook, all of which also hire contractors. \u201cThe internet industry is concerned about the implications of the Dynamex ruling and its potential to jeopardize internet-enabled, freelance work,\u201d the association\u2019s California government affairs director Kevin McKinley said in an emailed statement.<\/p>\n

The Chamber\u2019s coalition also includes the state associations representing restaurants, retailers, publishers, hospitals, shopping centers, child-care providers, farms, grape growers, manufacturers, trucking, taxis, ambulances and insurers. The coalition has gathered statements from workers about why they prefer to be classified as contractors, and is working to mobilize some for an Aug. 15 rally at the state capitol in Sacramento.<\/p>\n

Company officials are also urging their own workers to join the cause. On Thursday, DoorDash sent an email to its \u201cCalifornia Dashers\u201d telling them that the Dynamex ruling threatens their \u201cflexibility to choose when, where and how you want to work,\u201d and providing a web tool to send their state legislators a message asking them \u201cto help protect my freedom to choose the way I work.\u201d<\/p>\n

Attorney Shannon Liss-Riordan, who represents a worker suing DoorDash, responded by filing a motion Friday in federal court asking a judge to enjoin the company from “engaging in further coercive and misleading communications” that she alleged encourage workers covered by her putative class action lawsuit to “undermine their claims” in the case. DoorDash did not respond to inquiries.<\/p>\n

Workers\u2019 advocates have argued that responsible companies should welcome the clarity of the court\u2019s April ruling. \u201cIt\u2019s been a bit of a free-for-all, particularly in California, where a whole economy of companies has risen up in recent years saying that they can build their workforce off of workers that don\u2019t have any employment protections,\u201d said Liss-Riordan, who also represents workers currently suing other gig economy companies including Uber, Lyft and Postmates over alleged denials of employee rights (the companies have denied wrongdoing).<\/p>\n

Labor advocates say there\u2019s no reason for California to water down workers\u2019 rights. \u201cThese companies continue to have choices about their business model,\u201d union leaders from the state\u2019s building trades, Teamsters union affiliates, and AFL-CIO chapter told Governor Brown and legislative leaders in a July letter reviewed by Bloomberg. \u201cThey can convert workers to employees and retain control over their work rules and their rates. Or they can contract with true independent contractors. The only thing they can\u2019t do after Dynamex is have their cake and eat it too.\u201d<\/span><\/p><\/blockquote>\n

I prefer to to call them moochers, but, “Have their cake and eat it too,” works too.<\/p>\n","protected":false},"excerpt":{"rendered":"

In response to a state court ruling saying that workers for Uber, Lyft, Instacart, etc. are employees, the “gig” companies are lobbying for a law change. They knew that their business plans, which included meticulous tracking of so-called “independent contractors” ran afoul of the law, ignored this, and now they want the law changed to …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[365,368,364,465,437],"class_list":["post-178816","post","type-post","status-publish","format-standard","hentry","tag-business","tag-corruption","tag-evil","tag-labor","tag-regulation"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/178816"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=178816"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/178816\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=178816"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=178816"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=178816"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}