Earlier this year the California state legislature, employee-ng state in America finally passed a law requiring gig economy tech companies to treat drivers as employees rather than independent contractors. As the gig economy has grown over the last several years, there has been much debate about the proper legal designation for drivers. When workers are designated as employees, they’re entitled to certain fundamental things like minimum wage and workers compensation. If they’re independent contractors, there are no laws or regulations governing the relationship between the company and the worker.
The California law that was passed this year went beyond the employee designation, requiring drivers to be paid at least 120% of the minimum wage, 30 cents per mile for vehicle expenses, as well as money for health insurance if the drivers are working more than 15 hours a week.
It seems the tech companies have crunched the numbers on this new law and now they will go directly to voters and attempt to reverse the law with a ballot measure in 2020. If they succeed in this ballot measure, it will supersede the state legislature and prevent the passage of new laws contradicting it. Three major tech companies have shown their commitment by pledging $90 million to the campaign for the ballot measure. It’s already one of the most expensive ballot measures in history. Their first big hurdle is obtaining 660,000 signatures from registered CA voters, which is required before any measure can be added to the 2020 ballot. Once they’re on the ballot, they just need a majority of California voters to vote in favor of treating drivers as independent contractors. If the tech companies are successful, the state legislature will not be able to oppose it in future legislation.