Uber to SHUT DOWN in California? -- Holding off, Post #12

[JimMIA]

Uber's CEO says they may shut down rideshare operations in California for several months.

A lower court judge has ruled that Uber and Lyft must consider all drivers as employees, including paying minimum wage and benefits. Obviously, that lower court decision is being appealed.

However, if the decision sticks even temporarily the Uber/Lyft business model simply will not work and they may have to shut down pending a referendum on the ballot in November.

This won't affect WDW travelers, but certainly would affect DL visitors, as well as DISers who live in California.

https://www.cnbc.com/2020/08/12/uber-may-shut-down-temporarily-in-california.html

 

[JimMIA]

And now Lyft as well:

https://www.cnbc.com/2020/08/12/lyf...ay-have-to-suspend-service-in-california.html

 

[starry_solo]

I'm not surprised....

 

[StageTek]

AB5 was and is a terrible law. And it hits more than rideshare.

<---- is me working for Disney Broadcast Services as a camera operator. I get about 40 days a year from them doing everything from live events to press to promotional. I love it. Always been a freelancer and that's the way I want it. I work hard and am very good at my job which is why they keep hiring me. Now they can't.

A huge number of people in the Los Angeles area are gig entertainment workers - often called day hires or day players. I'm one of them. I love jumping from gig to gig for a day or three days or, maybe, a week. I get between 180 and 250 days per year as a freelancer. I can pick and choose the gigs I want. I can choose when I take time off. Now the California government has decided that's not good for me.

 

[JimMIA]

AB5 was and is a terrible law. And it hits more than rideshare.

<---- is me working for Disney Broadcast Services as a camera operator. I get about 40 days a year from them doing everything from live events to press to promotional. I love it. Always been a freelancer and that's the way I want it. I work hard and am very good at my job which is why they keep hiring me. Now they can't.

A huge number of people in the Los Angeles area are gig entertainment workers - often called day hires or day players. I'm one of them. I love jumping from gig to gig for a day or three days or, maybe, a week. I get between 180 and 250 days per year as a freelancer. I can pick and choose the gigs I want. I can choose when I take time off. Now the California government has decided that's not good for me.

Agree -- it was one of those knee-jerk political stunts that nobody really thought through very carefully. My SIL is in the same situation as you -- boom operator for movies and TV, thankfully not in CA. He's been in Atlanta for the last 3 years.

AB5 also applies to a ton of tech workers. It's a mess for California, but it's 100% self-inflicted.

 

[fabfemmeboy]

Agree -- it was one of those knee-jerk political stunts that nobody really thought through very carefully. My SIL is in the same situation as you -- boom operator for movies and TV, thankfully not in CA. He's been in Atlanta for the last 3 years.

AB5 also applies to a ton of tech workers. It's a mess for California, but it's 100% self-inflicted.

Just for the record, not all gig workers are happy with being gig workers who have no legal protections. I know quite a few who were happy when AB5 passed for that reason, even though this turn of events was 1000% predictable. Keep in mind that while there are benefits to being a freelancer to be sure - like getting to pick which projects you work on or take time off when you need it or leaving one employer for another if things are unbearable - there are serious disadvantages too. For one thing, it means that the worker is responsible for paying all the taxes, whereas if they're employees the employer is responsible for a portion of the taxes. I'm a small-business owner and a Schedule C sole prop, so I can say with certainty that the self-employment tax rate is awful. I pay twice as much in taxes as my employees do even if we make the same amount. And it's not like Uber is paying the freelancers more to make up for the shifted tax burden. Not being an employee also means that you aren't entitled to FMLA leave or paid vacation time, you don't have civil rights protection, you don't fall under the ADA, and you can't be sponsored by your employer for a visa, which is a serious problem in the tech industry. It makes the freelancers ineligible for payment of their work-required expenses like gas, insurance, and car cleaning. There are no rules to ensure that a freelancer/contractor is making minimum wage or overtime. If I drive for a delivery company as an employee, there are rules about how long my shift can be, how much I need to be paid per hour, and how much I need to be reimbursed if I'm using my own car; if I drive for Lyft then none of those rules apply. I can work 14 hours at a stretch and earn about $5/hour after all my mandatory expenses. And if the freelancer/contractor does something really stupid or reckless in the course of doing their work, the employer can't be sued even if they knew or should have known about the problem and would otherwise be liable. It basically lets the employer do an end-run around all other labor and employment laws by just calling someone a contractor.

There are some industries where freelance/contractor work is common and has been for decades, especially in entertainment. I was a contractor attorney for years, coming in on projects when a firm had way too much discovery to handle in-house and needed to hire more eyes. I definitely enjoyed the freedom to pick and choose projects, but I was also lucky: the type of job/classification I had still fell under standard wage-and-hour laws, including overtime; I didn't have any mandatory expenses that were required for my job but unreimbursable (except my bar license fees every year). My friends who do freelance photography have to pay their expenses out-of-pocket, but they set their rates. Sure, it's based on the market, competition, etc., but it's not like Lyft where they say "this is how much we're paying you for this ride." The industries that have sprung up around non-employees have just gotten really absurd. I'm mostly just really over tech companies that believe they're above the rules because they call themselves a technology platform instead of the industry they're actually in (see also Air BnB).

That said, I agree AB5 will have a ripple effect and unintended consequences for other industries that they probably should have thought about and written the law more clearly, but that's unfortunately not surprising.

 

[StageTek]

Just for the record, not all gig workers are happy with being gig workers who have no legal protections.

I don't know anyone who thinks all gig workers are upset with AB5. There is a good reason for it and everyone understands that.

I know it sounds uncaring and insensitive but gig workers who do not want to be gig workers can (and should) use the gig economy to earn money as they look for a "regular" job with all the legal protections and benefits.

That said, I agree AB5 will have a ripple effect and unintended consequences for other industries that they probably should have thought about and written the law more clearly, but that's unfortunately not surprising.

I agree with you, fabfemmeboy, it's not surprising. California's government once again uses a sledgehammer instead of a scalpel. They hurt many to protect some.

The consequences were foreseeable. There were many legal challenges and the bill could have been rewritten before it was passed. There are already exceptions - doctors, dentists, psychologists, insurance agents, stockbrokers, lawyers, accountants - but press photographers, journalists, musicians and below-the-line film and TV are not exempt. This bill hurts so many middle-class Californians. But even those of us who are being hurt fully understand that some employers abuse the independent contractor laws.

Just a little aside and I am in no way suggesting this is anything more than anecdotal: starting in early 2019 I asked every Uber and Lyft driver I rode with what they thought of AB5 - 2 to 8 rides a month. Every one of them didn't like it. They all had "day-jobs" and drove to make extra money and didn't want to be Uber/Lyft employees with set hours and an hourly wage. Over 12 months that's about 50 different drivers. Not one was happy to have that protection.

 

[DLgal]

There will be a proposition on the ballot here in Nov that will be the final say, apparently. I will be voting in favor of it. It will reverse this decision and make these types of employees independent contractors.

This whole thing is so stupid. Independent Contractors exist in many industries and anyone who accepts a job as such understands how it works. If these drivers don't like the way it works, then stop working for them! You can't have your cake and eat it too. If you want the freedom to create your own schedule and work as much or as little as you want, there are drawbacks to those positives as well. It takes more work on your part. You have to do more accounting.

I have considered a few different jobs recently until I learned they were IC jobs. I personally don't want to deal with that so I passed on them. It's a personal choice to take this type of work.

It would have been different if these companies started out as employers and then switched over to the IC model, but they didn't. They were upfront and transparent about it from day one.

I really like living in CA, but sometimes laws are passed that make absolutely no sense and make me roll my eyes for the amount of virtue signaling they seem to be mostly about (looking at you, plastic straw ban).

 

[JimMIA]

This whole thing is so stupid. Independent Contractors exist in many industries and anyone who accepts a job as such understands how it works. If these drivers don't like the way it works, then stop working for them!

Exactly. This is not rocket surgery.

Here is the offer -- take it or leave it. You like it? Okay, we'll cut your pay 25%. Still on board? Cool...another 25%! Don't like it? Quit.

I did quit, but I never felt like I was being abused. As you said, I understood how it worked, and as long as it made sense I continued. When it no longer was worth my time, I quit.

No hard feelings, and no regrets about either driving nor quitting.

 

[StageTek]

I'm sure you've heard: As of August 21 Lyft will no longer provide service in California. I wonder if Uber will follow or just be happy to fill in the void?

 

[JimMIA]

I'm sure you've heard: As of August 21 Lyft will no longer provide service in California. I wonder if Uber will follow or just be happy to fill in the void?

Didn't know that, but yeah -- 11:59 PM tonight. I'm guessing Uber will shut down as well.

From the Lyft website:

https://www.lyft.com/rider/californiaupdate

 

[JimMIA]

Looks like the threats worked:

https://www.cnbc.com/2020/08/20/app...rieve-in-case-over-driver-classification.html

 

[StageTek]

Well... until Aug 25. So we can all ride over the weekend.

This is quite the drama, isn't it?

 

[JimMIA]

Well... until Aug 25. So we can all ride over the weekend.

This is quite the drama, isn't it?

Not for Joel and I, lol!

But this drama will be nothing compared to the drama if the state wins all the lawsuits and this gets fully implemented. Uber and Lyft will be forced to really shut down in CA. They're losing money with the current model; there's no way they can ever earn a profit if they have to make their drivers employees.

And, as you've mentioned above, there are much more important industries where AB5 could inflict real catastrophic impacts.

 

[StageTek]

And, as you've mentioned above, there are much more important industries where AB5 could inflict real catastrophic impacts.

That's the problem with Prop 22. It only addresses App-based drivers. Photographers, journalists and a huge number of entertainment workers won't get any help from Prop 22. It's been difficult getting work in "Hollywood" for 15 years due to production leaving the state. Now...

 

[JimMIA]

That's the problem with Prop 22. It only addresses App-based drivers.

Right, and that's typical of the People's Republic of California's knee-jerk reactions. They start out only wanting to shoot themselves in the foot and they end up blowing a leg off through stupidity.

AB 5 was initially only intended to help rideshare drivers. It wouldn't help them...but that's beside the point.

Ah, but anything worth doing is worth overdoing -- so they included the entire rest of the independent contractor world. In doing so, they not only messed up individual workers, they also hurt entire industries -- like tech, film and music, etc.

Photographers, journalists and a huge number of entertainment workers won't get any help from Prop 22. It's been difficult getting work in "Hollywood" for 15 years due to production leaving the state. Now...

Right. My SIL used to do most of his work either in LA or on projects based in LA. He did all of the Transformers series from #2 forward, for example. He's been in the business 20+ years.

But increasingly, movies have been based in Louisiana, Detroit, Atlanta, and other more hospitable environments where local and state governments WANT the film industry. Miami used to be one of those locales as well, but no more, and it's a shame. The only "film" industry we have here is porn, and I think LA is similar.

 

[StageTek]

Right. My SIL used to do most of his work either in LA or on projects based in LA. He did all of the Transformers series from #2 forward, for example. He's been in the business 20+ years.

Then he and I have been on the same set. I did some special effects for Transformers 2 and 4.

If I didn't have my "day job" (which I don't have now...) as a stagehand and pyro operator I'd have moved to Atlanta years ago. In hindsight, I should have; starting over at my age isn't really an option. Born and raised in California (2nd generation - how's THAT for rare) and I might have to leave because our elected officials have contempt for individual liberty and the entertainment industry. They proved their contempt for manufacturing decades ago.

 

[gatour]

Right, and that's typical of the People's Republic of California's knee-jerk reactions. They start out only wanting to shoot themselves in the foot and they end up blowing a leg off through stupidity.

AB 5 was initially only intended to help rideshare drivers. It wouldn't help them...but that's beside the point.

Ah, but anything worth doing is worth overdoing -- so they included the entire rest of the independent contractor world. In doing so, they not only messed up individual workers, they also hurt entire industries -- like tech, film and music, etc.

Right. My SIL used to do most of his work either in LA or on projects based in LA. He did all of the Transformers series from #2 forward, for example. He's been in the business 20+ years.

But increasingly, movies have been based in Louisiana, Detroit, Atlanta, and other more hospitable environments where local and state governments WANT the film industry. Miami used to be one of those locales as well, but no more, and it's a shame. The only "film" industry we have here is porn, and I think LA is similar.

Yes by using the state taxpayers to subsidize movies being made. I am sure restaurant owners etc. would love to get the same consideration but don't

 

[Jonfw2]

I love that the whole reaction from state officials in California is like confusion..."wait- you mean you don't have to do everything we say??? Hey! Come back!!!"

 

[StageTek]

Yes by using the state taxpayers to subsidize movies being made. I am sure restaurant owners etc. would love to get the same consideration but don't

The taxpayers do not subsidize movies being made. The city's and the state reduce the taxes the companies must pay. Lower taxes encourage businesses to do business in the state. If a movie production can save 20% on taxes that means several million dollars to them. That's why movie production moved out of California. And now the city and states gets nothing rather than 80%. And with that move the "regular" worker is hurt.

Here in Los Angeles as movie production left California all the local businesses suffered; restaurants, cleaners, auto dealers, hotels, hair cutters, markets. Because there are hundreds of thousands of people working in film and TV who use all these businesses. We rent homes and apartments, buy homes, we eat at restaurants, we shop, we buy cars.

Other states have encouraged production because they understand how much spending a movie brings to their community. Movie workers who live in a city for 8 to 12 weeks spend their money right there. Tax breaks clearly work. Georgia is now the top place to make movies. New Mexio is reaping the befefits of tax breaks. New Orleans, Seattle, Minneapolis all love having the influx of work and spending in those cities. And far more than film workers benefit. With so many people in a city working they go to restaurants. So that restaurant owner might not get a tax break from the state, but they get more business. And that's a good thing.