Uber’s nationwide push over gig employee standing has been underway for months


Over the past yr, Uber drivers protested a number of occasions in entrance of the corporate’s headquarters, demanding extra employee protections.

James Martin/CNET

Jason Schaal was sitting at house in Minneapolis final month when he opened his cellphone to test his e-mail. Among the many messages was one from Uber bearing the topic line, “Make your voice heard.” It mentioned the US Division of Labor was hammering out countrywide guidelines “to find out the impartial standing of gig employees” and requested Schaal to touch upon the plan. As an Uber driver, Schaal mentioned he discovered the persuasive tone of the e-mail unsettling.

“One of many prime causes you drive with Uber is the pliability,” learn the Oct. 22 e-mail, which was seen by CNET. It requested Schaal to share just a few sentences about being an impartial contractor, giving prompts like “the flexibility to steadiness different jobs” and “earn extra cash as a scholar, caretaker or retiree.”

Schaal, who does full-time gig work for Uber, Lyft, Instacart and Shipt, clicked the hyperlink within the e-mail, which took him to a remark web page on the Division of Labor’s web site. He opted to not go away suggestions.

“As I learn that e-mail, one of many impressions I obtained is that Uber goes to place their spin on issues,” Schaal mentioned throughout a cellphone interview. “It is virtually manipulating to steer drivers to remark with Uber’s viewpoint.”

The timing of Uber’s message was no coincidence. It got here 12 days earlier than the ride-hailing firm’s huge victory in California, the place it and different gig economic system firms spent $205 million to persuade voters to approve its Proposition 22 poll measure. The measure ensures that drivers within the state are categorized as impartial contractors, reasonably than workers, sidestepping the necessity for firms to offer advantages like medical health insurance. The businesses hope to copy their poll field success throughout the nation, they usually’ve already been plotting their nationwide push.

Spokespeople for Uber, Lyft, Instacart and DoorDash confirmed to CNET that the businesses are planning to deliver their Proposition 22 mannequin nationwide, saying that is what gig employees need.

The emails to drivers like Schaal characterize only one component of Uber’s broader technique to go countrywide. In August, the corporate revealed a white paper outlining “priorities for trade and authorities motion” on gig employee classification state by state. That very same month, Uber launched findings from a nationwide survey it commissioned on what drivers and voters take into consideration employees being categorized as impartial contractors. The corporate has additionally employed a document variety of federal lobbyists and created an info portal for drivers titled “Collectively, we are able to reinvent impartial work.”

Now, with the California vote displaying it is attainable to beat legal guidelines and regulators with some huge cash and groundwork, Uber and its gig economic system companions have hit the bottom operating in the remainder of the nation. Emboldened by the Proposition 22 win, Uber and Lyft mentioned they have been reaching out to unions, state regulators, governors and federal officers. The businesses say California may function a template for the way gig employees needs to be categorized nationwide.

“Going ahead, you will see us extra loudly advocate for brand new legal guidelines like Prop 22,” Uber CEO Dara Khosrowshahi mentioned throughout an earnings name earlier this month. “It is a precedence for us to work with governments throughout the US and the world to make this a actuality.”

On Wednesday, Uber, Lyft, Instacart, DoorDash and Postmates launched a coalition out of Washington, DC, known as the App-Primarily based Work Alliance. The intention, the coalition says, is to “protect employee independence.” It factors to Proposition 22’s passage and says it should educate state officers on impartial work and “promote federal insurance policies that help the rising on-demand economic system and urge Congress to assume extra ambitiously with regards to modernizing our nation’s labor legal guidelines.”

The gig economic system firms say this battle is existential. In the event that they’re required to categorise drivers as workers, the businesses should pay for drivers’ medical health insurance, minimal wage and sick go away — including excessive prices that the businesses say may damage their backside traces. Uber, Lyft and DoorDash aren’t but worthwhile. In accordance with Uber, about 7 million individuals within the US did gig work for at the very least one of many firms in 2019, with about 1 million of them working for Uber.

As for gig employees, many say they want extra labor protections from the businesses. They are saying they battle to pay lease and physician payments, and to place meals on the desk, in keeping with a survey by the Institute for Social Transformation on the College of California, Santa Cruz. Drivers and labor activists who opposed Proposition 22 say they too are planning to take their battle nationwide.

“The large platform firms might have gained in California, however the gig employee combat has solely simply begun,” mentioned Brendan Sexton, govt director of the Impartial Drivers Guild, which represents 800,000 ride-hail drivers in New York, New Jersey and Connecticut. “California’s expertise ought to gentle a hearth beneath pro-worker state legislatures throughout the nation.”

Captive viewers

Schaal had been off work for 5 days when he obtained the e-mail from Uber. He was house as a result of he was ready for outcomes from a COVID-19 take a look at after he’d been probably uncovered to the novel coronavirus whereas doing a gig job for Shipt, a supply firm owned by Goal. He mentioned he was already anxious about not getting cash that week, and the e-mail simply added to his worries.

“It simply got here out of the blue,” Schaal mentioned. “I do not see any internet optimistic impact of permitting the businesses to pressure the definition of what we’re down our throats.”

Uber used the direct-message tactic to additionally foyer help from drivers in the course of the Proposition 22 marketing campaign. Each Uber and Lyft bombarded drivers and passengers, stumping for the proposition and saying job flexibility could be misplaced and costs would skyrocket if drivers turned workers.

“You’ll be able to change the narrative primarily based on the diploma to which you are being conscious of your customers — all by an app. That could be a advertising goldmine,” mentioned David McCuan, a political science professor at Sonoma State College. “That’s the energy of Massive Tech.”


Instacart and DoorDash additionally introduced the poll measure marketing campaign to prospects, asking supply employees to insert pro-Proposition 22 stickers into prospects’ orders and use takeout luggage branded with the phrase “Sure on 22.”


Uber’s messages to California drivers included asking them to document 30- to 60-second movies of themselves describing why flexibility is necessary. However that marketing campaign introduced backlash. Drivers filed a lawsuit towards Uber in October alleging they feared retaliation in the event that they did not take part within the firm’s in-app surveys. In response, Uber advised the court docket it might cease political polling on the app in California. A decide later rejected the lawsuit.

Different tech heavyweights have used comparable methods prior to now, however to not the size of the gig economic system firms. Earlier this yr, Google tried to stamp out a invoice in Australia that may require it to pay native information shops. The corporate wrote an open letter to customers arguing the invoice would make search “dramatically worse,” then linked to the letter on its Australian homepage. 

In 2012, web firms protested towards the Cease On-line Privateness Act and the Shield IP Act, two payments the tech trade noticed as threatening to free expression and innovation. Google blacked out the company brand on its iconic house web page and, if somebody clicked on it, despatched customers to a “Finish Piracy, Not Liberty” petition. Mozilla did the identical with its Firefox browser. Wikipedia shut down for 24 hours, as a substitute solely displaying a darkened web page that mentioned “Think about a World With out Free Data.”

The gig economic system firms’ win on Proposition 22 may encourage different tech firms to make the most of captive audiences. However giants like Google and Fb in all probability will not overuse their platforms as soapboxes, says Jack Poulson, founding father of watchdog nonprofit Tech Inquiry. These greater firms are extra doubtless to make use of lobbyists to get out their messages. Although Uber makes use of lobbyists as nicely, Poulson says, it is way more freewheeling with its public picture.

“With Uber, their model has been by the mud,” mentioned Poulson. “They take a little bit of a mercenary tone.”

The ‘third manner’

Uber has been laying the groundwork for its nationwide push on gig employee standing over the previous couple of years, however in late March it made a splash bringing its thought to the general public.

Because the coronavirus raged throughout the nation, Uber CEO Khosrowshahi despatched President Donald Trump a letter searching for assist. He started the three-page letter asking the federal government to incorporate impartial contractors in its financial stimulus bundle. He then laid out his case for altering labor legal guidelines to create what he known as the “third manner.”

The concept, he mentioned, is to invent a brand new class of employees who’d be categorized as impartial contractors however get just a few extra perks. He implied that present labor legal guidelines may find yourself hurting gig economic system firms, saying, “every time an organization offers extra advantages to impartial employees, the much less impartial they change into; and, with out legislative readability, the extra uncertainty and threat the corporate bears.”

Since then, Uber has expanded on its “third manner” plan with its white paper, nationwide survey and a New York Instances op-ed by Khosrowshahi discussing the brand new employee mannequin. The 18-page white paper says it is supposed to encourage dialog amongst a variety of stakeholders and emphasizes the “pressing want for brand new high-quality impartial work.” The paper outlines Uber’s plan to work with governments to provide impartial contractors some advantages that workers have already got, corresponding to accident insurance coverage and safety beneath discrimination legal guidelines.

“Within the early days, at the very least on this technology of startups, the founders did not take politics severely,” mentioned Bradley Tusk, Uber’s first political advisor and CEO of consulting agency Tusk Methods. “That is modified.”

Within the first half of 2020, Uber employed a document variety of 40 lobbyists and spent $1.2 million lobbying the federal authorities, in keeping with Open Secrets and techniques. Lyft additionally shelled out greater than it had prior to now for federal lobbying, spending $760,000 and hiring 36 lobbyists within the first half of the yr.

Although Uber and Lyft have been laying the groundwork to vary labor legal guidelines federally, Tusk mentioned that could be an uphill battle beneath the administration of Democratic president-elect Joe Biden. Each Biden and Vice President-elect Kamala Harris publicly opposed Proposition 22. And since getting elected, Biden has promised to deal with gig economic system firms that classify employees as impartial contractors.

“This epidemic of misclassification is made attainable by ambiguous authorized assessments that give an excessive amount of discretion to employers, too little safety to employees, and too little path to authorities businesses and courts,” reads Biden’s plan on employee empowerment.

A better path for the “third manner” could be a state-by-state possibility, Tusk mentioned. An Uber spokesman advised CNET the corporate is in talks with lawmakers in states throughout the nation however declined to specify which of them. “We’re pushing to provide drivers new advantages and protections in different states — a proposal that drivers nationwide strongly help,” the spokesman mentioned.

It is unclear if lawmakers in Minnesota, the place Schaal lives, are assembly with the gig economic system firms. The one info Schaal mentioned he is obtained from Uber was the e-mail urging a federal plan.

Schaal mentioned he went again to work doing deliveries and giving rides after his COVID-19 take a look at got here again unfavourable. He is undecided what the fitting method is on defining gig employees, however he is sure that safeguarding employees’ rights is essential and authorities officers ought to take that under consideration when altering any legal guidelines.

“Increasingly more we’re at this crossroads the place we’re defining the following class of American employee,” Schaal mentioned. “We’d like to ensure we now have sure rights and protections.”

CNET’s Richard Nieva contributed to this report.

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