09/21/2019

California to thrash out gig worker status in upcoming bills

Gig worker or employee?

California will wrestle with that question this year with efforts under way in Sacramento to either codify or limit a groundbreaking state Supreme Court decision issued in April.

The ruling, in a suit brought by delivery drivers at Dynamex, made it harder for businesses to classify workers as independent contractors. It implemented a formula, called the ABC test, that says workers are employees if companies control what they do, if their tasks are central to a company’s core business, and if they don’t run independent businesses doing that work.

The ruling could upend scores of industries that rely on independent contractors, ranging from gig economy companies like Uber and Lyft to traditional areas such as architects, lawyers, insurance agents and emergency-room doctors.

Now, lawmakers, labor, companies, trade associations and workers are negotiating what will happen next. Unions want Dynamex to be enshrined as state law; companies do not. So far Dynamex has not resulted in any large-scale reclassification, although it has been cited as precedent in a few legal cases. Uber and Lyft drivers, for instance, remain independent contractors.

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