In the fall of 2019, California passed Assembly Bill 5 (AB5) that attempts to reclassify independent contractors as employees by changing the test used to determine worker classification. By requiring these drivers to become employees, drivers lose flexibility and independence that comes with independent contractor status; an important reason why so many people choose app-based driving and services as work in the first place. The Protect App-Based Drivers & Service Act was created in an effort to retain the independent contractor status of app-based drivers and services. Because of COVID19, app-based drivers and services are playing an essential role more than ever.
With COVID-19 and the ensuing stay at home orders, thousands of people were put out of work, many of whom turned to app-based driving to supplement their income. Furthermore, as a result of stay at home orders, more and more people are turning to delivery options for food, groceries, medicine, and more to minimize exposure to COVID-19, increasing the demand for delivery drivers. As independent contractors, these drivers earn money while maintaining flexibility during such uncertain times. Without the flexibility of independent contractor status, it becomes increasingly difficult for individuals looking to create an additional stream of revenue.
Proponents of AB5 say the permanent employee status will provide gig workers with benefits like unemployment insurance, health care insurance, and vacation time. However, according to a recent poll, it was found that 71% of drivers want to retain their status as independent contractors versus 17% that want to become employees. The Protect App-Based Drivers and Services Act addresses the issues raised by AB5 supporters by offering protections including an earning guarantee, health care contributions, occupational accident insurance, automobile accident and liability insurance, and protection against discrimination and sexual harassment. Furthermore, the act would also require recurring background checks of drivers, mandatory safety training of drivers, zero tolerance for alcohol and drug offenses, and a cap on driver hours per day to prevent sleepy driving.
The Protect App-Based Drivers and Services is calling for Californians to approve the 2020 ballot measure that would allow gig workers to retain their independent contractor status, rather than require companies to turn them into permanent employees.
DDI is proud to already offer some of the services laid out in the Protect App-Based Drivers and Services Act. We believe in supporting the rights and high quality working environments for drivers by offering occupational accident insurance, utilizing recurring background checks, and maintaining a zero-tolerance for alcohol and drug offenses. If your business utilizes independent contractors, learn more about how DDI gives you peace of mind in the regulatory landscape.