Newsom signs bill reforming gig work
SACRAMENTO — Gov. Gavin Newsom has signed AB5, California’s landmark gigworker bill that could turn thousands of independent contractors into company employees with protections and benefits.
“The hollowing out of our middle class has been 40 years in the making, and the need to create lasting economic security for our workforce demands action,” Newsom said Wednesday, in a signing statement released by his office.
Newsom, who signed the bill in a private ceremony with lawmakers and staff, said the misclassification of workers has eroded basic labor protections like minimum wage, paid sick days and healthinsurance benefits.
Lawmakers approved the bill, written by Assemblywoman Lorena Gonzalez, DSan Diego, last week, in the final days of their annual session. It would reclassify gig workers such as Lyft and Uber ridehailing drivers, along with many other
independent contractors.
“As one of the strongest economies in the world, California is now setting the global standard for worker protections for other states and countries to follow,” Gonzalez said in a statement Wednesday.
The law faces fervent opposition from tech companies. Uber, Lyft and DoorDash warned that they would spend at least $90 million to sponsor a ballot initiative to overturn it. Uber has gone a step further, saying it will fight in court to keep its drivers independent contractors.
Turning contractors into employees would affect a wide range of industries, from trucking to health care to media. Dozens of occupations, from real estate brokers to commercial fishermen to hairstylists, have already won exemptions. Opponents of the law, which takes effect Jan. 1, have said they would seek further exemptions or amendments.
Uber said the company has tried to negotiate an alternative labor framework that would guarantee gig workers minimum earnings, some benefits and a chance to band together as independent contractors.
“We’ve engaged in good faith with the Legislature, the Newsom administration and labor leaders for nearly a year on this issue, and we believe California is missing a real opportunity to lead the nation by improving the quality, security and dignity of independent work,” the company said.
The law does not immediately turn contractors into employees on Jan. 1. Instead, workers or labor enforcement agencies would have to challenge a worker’s classification as a contractor. To toughen the law, Gonzalez added a provision that also allows public attorneys, including the state attorney general and city attorneys in large cities like San Francisco and Los Angeles, to enforce its provisions.