Fate of gig workers remains unresolved by lawmakers, courts

What will the labor landscape look like for gig drivers over the next few years? While the passage of the Uber, Lyft, and DoorDash-backed Proposition 22 seemed to settle that question for voters in November, winding down an often hostile battle between workers' advocates and gig companies, Joseph Biden's victory in the presidential race seemed, for some, to portend another answer: that the fate of gig drivers has not yet been decided.

Since his inauguration Wednesday, Biden has made several moves that appear to deliver on his promise of taking a more labor-friendly stance than the Trump administration -- including firing National Labor Relations Board general counsel Peter Robb after the attorney refused to voluntarily resign. The Service Employees International Union and Communications Workers of America were among a number of unions that urged Biden to oust Robb before his term expired in November, based on what they said was Robb's record of siding with employers.

Attorneys representing both workers and businesses expect the Biden administration to make more changes during his term to overturn key labor policies and decisions launched by the previous administration, including some that substantially raised the bar for workers -- including drivers -- to be classified as employees instead of independent contractors. But these attorneys say there's also a possibility that Biden could introduce new legislation to regulate the conditions of gig drivers -- and undermine Proposition 22 as a result.

For gig drivers in California, a major question about their rights is whether they could potentially secure the right to collectively bargain. While a provision in Proposition 22 only allows the state Legislature to extend these rights to drivers with a 7/8 majority vote, a pending petition that the SEIU, SEIU California State Council and rideshare drivers recently filed with the state Supreme Court allege this provision is unconstitutional. Castellanos et al. v. California et al., S266551.

Even without Proposition 22, the question of whether the Legislature can extend collective bargaining rights to independent contractors -- who are generally not allowed to engage in collective bargaining under federal antitrust law -- is an open legal question, said Rey Fuentes, Skadden Fellow Partnership for Working Families. Fuentes has been involved in efforts to develop an app with driver advocacy group Gig Workers Rising, which was launched in December and aims to help drivers understand their rights under Proposition 22.

The question "really came to the fore because of what Seattle did to these types of workers," Fuentes said in an interview. In 2015, the City of Seattle passed an ordinance to grant Uber and Lyft drivers certain collective bargaining rights, which was challenged by the U.S. Chamber of Commerce for violating the Sherman Antitrust Act. The U.S. 9th Circuit Court of Appeals eventually found the city did not have the right to establish such an ordinance, since it did not have the "state immunity" that would exempt it from the antitrust law.

While the 9th Circuit did not definitively rule whether states could extend collective bargaining rights to independent contractors, the court implied if the state of Washington had established a law similar to the City of Seattle's ordinance, "the case might have been different. But that wasn't the posture of the case," Fuentes said. If challenges to Proposition 22 succeed, the state Legislature could potentially introduce a bill for gig workers similar to the Agricultural Labor Relations Act of 1975, a state statute that extended collective bargaining rights to agricultural workers, who were exempted by Congress from the National Labor Relations Act, he added.

The Biden administration could potentially make such a task easier for California and other states, said Travis Gemoets, a partner at Jeffer Mangels Butler & Mitchell LLP who represents employers. "Could the Biden administration modify federal law to allow states more leeway in whether they want to confer collective bargaining rights onto non-employees? The answer is yes, they could," he said. But, he added, "That would definitely negatively impact the gig economy from the perspective of allowing gig workers to perform their work as independent contractors" -- an economy many California voters agreed they wanted in November, he said.

In addition to the collective bargaining question, the question of whether Proposition 22 will hold up, or whether the model it forged will spread to other states, is also top of mind, Gemoets said. A federal law that says gig drivers are employees "could eviscerate Proposition 22," he said, but added he did not believe such a law was likely.

While Proposition 22 did not give gig drivers the rights employees are entitled to, it did raise the floor for how independent contractors are treated by giving them certain benefits, said Gemoets. He said he has seen businesses that are reluctant to extend similar benefits to independent contractors, for fear of violating employment laws that would deem them the contractors' employers. "What I could see happening is a loosening... of the federal law that would allow employers to provide certain benefits and protections to their independent contractors without that in and of itself creating an employment relationship," he said.