Federal labor law could allow gig drivers to unionize

By establishing an "ABC" test as the standard for deciding whether a worker has the right to collectively bargain, the federal Protecting the Right to Organize Act could potentially allow gig drivers to unionize -- even though Proposition 22 currently prevents them from doing so in California.

If Congress doesn't pass the ambitious federal bill -- which is commonly referred to as the PRO Act and would make sweeping amendments to the National Labor Relations Act -- the prospect of gig workers unionizing would still be on the table as long as President Joseph Biden's administration controls the National Labor Relations Board, attorneys say.

When the Uber, Lyft, and DoorDash-backed Proposition 22 went into effect after voters passed it into law last November, the ballot measure essentially exempted gig drivers from being held to the same worker classification standard as most other California workers. While businesses were usually required to determine whether they should treat workers as independent contractors or employees by using the so-called "ABC" test -- a three-pronged test that has a more expansive definition of "employee" than tests previously used in California -- Proposition 22 decisively classified gig drivers as independent contractors, while providing them with some benefits.

There is no provision in Proposition 22 that explicitly bans gig drivers from collective bargaining. But opponents of Proposition 22 -- including unions that recently tried to challenge the ballot measure in the state Supreme Court -- argue it effectively does so, in a roundabout way: It bans the Legislature from making certain amendments to Proposition 22, and defines one such amendment as "any legislation authorizing any entity or organization to represent the interests of app-based drivers in connection with their relationship to the gig companies or with respect to their compensation, benefits, or working conditions."

If Congress passes the PRO Act and establishes the "ABC" test as the worker classification standard for workers across the nation, California's gig drivers would also be subject to that test and likely be classified as employees for the purpose of assessing their rights under the National Labor Relations Act, said Rey Fuentes, a Skadden Fellow at the Partnership for Working Families. Under the act, employees, unlike most independent contractors, are legally allowed to engage in collective bargaining. Proposition 22's de facto ban on collective bargaining among gig drivers "would no longer be enforceable and no longer be relevant because workers have the option to organize under federal law," added Fuentes, who has worked with gig driver advocacy group Gig Workers Rising.

Chris Foster, a partner at McDermott Will & Emery LLP who represents employers, agreed this would likely happen if the PRO Act passed. "Once the NLRA gives organizing and bargaining rights to a certain group of workers, the states can't have their own shadow system" -- like Proposition 22 -- "that would interfere with their own federal regulatory system and scheme," he explained.

Another way the Biden administration could potentially extend collective bargaining rights to gig drivers is by reversing a National Labor Relation Boards memo in 2019, which said the nation's gig drivers should be considered independent contractors for the purpose of assessing their organizing rights, Fuentes added.

While labor advocates say such an outcome would be beneficial for drivers, Ron Holland, another partner at McDermott, said it could create confusion. In California, he said, gig drivers would be "exempted from most of California's employee wage and hour type laws, but then for purposes of collective bargaining you've got them in a position where unions can organize them," Holland said. "It's almost like a dissonance. I imagine unions will attempt to bargain the wage and hour laws into the collective bargaining agreements."

But Fuentes said even if gig drivers were granted the right to collectively bargain, that doesn't necessarily mean it would be easy to organize them. Getting employees to vote yes for a union "is incredibly difficult with an automated workforce and atomized workforce that doesn't really work in one central location and comes in and out of the labor market quite frequently," he said. This would be the case, he added, "even under the PRO Act."