One of the most contentious battles of this year’s legislative session was AB 5, with labor and gig economy companies duking out over the definition of who is an employee and who is an independent contractor.
In this battle over the “new economy” and the “future of work,” there was a lot of contention over what jobs should be exempt from the bill’s requirements and which should be subject to them.
As PRI’s Kerry Jackson wrote of the final version of the bill, “it was just another exercise in government choosing winners and losers.”
One of the main losers of the bill are gig economy companies like Uber, Lyft, and Door Dash. Unions in California have placed a big target on gig economy firms because they disrupt the old, 9-to-5, union employee way of doing business. Bills like AB 5 will provide a big boost in their goal to unionize gig economy workers.
These firms did not take this bill lying down and have pledged at least $90 million for a ballot measure campaign next year to ask voters to approve their preferred solution on the worker classification issue.
This continues the trend of companies and the industries no longer taking the Legislature’s bullying lying down and using the ballot initiative process to let the people decide these complex issues. As I wrote about last year, the soda industry successfully pushed the Legislature to place a moratorium on soda taxes when the industry qualified a statewide ballot measure that would have put an end to most local tax increases used to fund liberal priorities.
But a little noticed bill passed by the Legislature in the final days of this year’s session may make it much more difficult for these gig economy firms to qualify their measure for the ballot – even with $90 million.
Assembly 1451 is the latest example of Sacramento’s liberal majority tinkering with California’s elections process to maximize their partisan advantage.
The bill would do two things. First, it would prohibit petition gathering firms from paying their workers a “bounty” for collecting signatures. This is often how the signature gatherers who set up shop in front your local grocery store gets paid for collecting signatures.
Years ago, when I worked on a political campaign in Southern California, we hired folks to register people to vote and collect signatures to place our candidate on the ballot. There was a “bounty” of a few dollars per signature which was an incentive for the signature gatherers to work hard. Also, we worked with volunteer organizations like the local Republican Women’s chapter, as they made money for their clubs by collecting signatures and receiving the per signature bounty.
This provision in AB 1451 would effectively force proponents to spend more of that $90 million than expected gathering signatures because they’d have to hire hundreds of people as salaried employees to collect signatures.
The other, more troubling provision would require that 10 percent of signatures for a ballot measure be collected by unpaid circulators or employees or members of nonprofit organizations. This would be another major advantage for union and hit for business groups.
Unions are non-profit organizations, so the bill wouldn’t affect their grassroots efforts at all when trying to collect signatures for ballot measures or discourage voters from signing a competing measure. But business organizations often lack a grassroots component.
The bill’s author, Democratic Assemblyman Evan Low, says that, “by ensuring that a fraction of signatures are gathered by those who truly believe in the policy behind an initiative process, AB 1451 will help curb abuses of the initiative process by special interests.” In other words, it will make it much harder for outside groups to go around the whims of the Legislature’s majority by seeking a ballot measure. Ironically, Former Gov. Brown vetoed multiple versions of this bill in recent years, saying “this measure will not keep out special interests or favor volunteer signature gathering.”
Low is right that it could be quite difficult for business groups to find grassroots organizations to collect and submit enough signatures for a ballot measure. It’s unlikely that there is an organized, grassroots group of Uber fans ready to spring into action and organically collect 10 percent of the signatures. You might see business groups forming their own nonprofits and hiring their own employees to get around the provisions of this bill – which would be a difficult, time consuming, and expensive proposition.
While AB 1451’s changes may sound benign, it could in practice be a huge roadblock for groups like Uber, Lyft, or Door Dash to try and qualify their measure for next year’s ballot.
Tim Anaya is the Pacific Research Institute’s communications director.