Uber Technologies Inc., Lyft Inc. and other ride-share and on-demand companies in California said Tuesday they would submit a ballot initiative that would alter a statewide law intending to reclassify contract workers as full-time employees.
The companies are funding the measure, called the Protect App-Based Drivers and Services Act, aiming to get it on the November 2020 state ballot. The initiative would effectively exempt Uber, Lyft and similar on-demand companies from key provisions of what is known as the gig-economy law, while also adding guarantees to ride-share workers to appease the law’s defenders.
While lawmakers and supporters have said the gig-economy law, which was enacted in September and will go into effect in January, could raise wages and provide new benefits for workers, critics have said it will raise costs for companies and force them to introduce hourly schedules that would take away the flexibility many drivers want.
Uber, Lyft and food-delivery company DoorDash Inc., who promised to spend a combined $90 million on a ballot measure to counter the law, officially kick-started the process Tuesday by announcing plans to submit the 17-page initiative to the state attorney general’s office for review.
Next, the coalition backed by the companies will have to gather at least 623,212 petition signatures from registered voters—equal to 5% of the votes cast for all candidates for governor in the last California gubernatorial election—before California Secretary of State Alex Padilla can qualify the initiative for the statewide ballot next year.
Brandon Castillo, a spokesman for the coalition, said the group plans to start collecting signatures in January. Ballot initiatives must be approved at least 131 days before an election, putting some time pressure on The ballot measure includes several guarantees to ride-share and delivery drivers that coalition members say don’t currently exist, such as giving drivers 30 cents a mile driven to account for gas and other vehicle costs, health-care subsidies for drivers who work 15 hours or more a week and occupational-accident insurance coverage while on the job.
Mr. Castillo said the group doesn’t seek to rewrite the entire gig-economy law, known as Assembly Bill 5 or AB5, which also affects workers in other industries from trucking to janitorial services, and aims only to create statutes for ride-share and other on-demand drivers.
“This initiative is for the thousands of Californians who are accessing this type of flexible work to supplement income or for a way to support their families,” Mr. Castillo said in an interview Tuesday. “It’s also for customers who are accessing these services every day.”
Assemblywoman Lorena Gonzalez, who wrote the gig-economy law, said the ballot initiative is disingenuous.
“There is nothing in either the State Supreme Court’s decision or AB5 that impacts flexibility for workers,” Ms. Gonzalez said Tuesday. “These billion-dollar corporations still refuse to offer their workers what every other employee in California is entitled to: earning the minimum wage for all hours worked, social security, normal reimbursements for their costs, overtime pay, and the right to organize.”
As the law stands, Uber, Lyft and other companies will face a stricter test to prove that their drivers are independent contractors, including showing that drivers’ services are outside the companies’ usual course of business. The companies have said the law could result in higher fares for customers in California. Surgeons, psychologists, veterinarians, lawyers, engineers and many other professions have already been exempt from the law.
Uber has said it doesn’t intend to change its practices in response to the measure because it believes it could prove in a legal setting that its drivers are independent contractors. Lyft has told drivers they may “soon be required to drive specific shifts, stick to specific areas, and drive for only a single platform.”
The initiative seeks to retroact any enforcement or legal challenge of the law during the next year if the measure is qualified and ultimately passed by voters next year, Mr. Castillo said.
Uber, Lyft and DoorDash first threatened a ballot measure in August. The companies offered lawmakers proposals—including a minimum wage of $21 an hour—to try to reach a compromise before the gig-economy law passed but didn’t come to an agreement.
the group to get the support it needs.