Bay Area ride-hail drivers are among those who have been hit hardest by lost wages as travel grinds to a crawl during the state-wide shelter-in-place order imposed to slow the spread of COVID-19.
But Uber and Lyft drivers, along with other gig workers who traditionally would not qualify for out-of-work compensation, could soon receive unemployment checks if they’ve seen their income disappear or become drastically reduced. The safety net expansion is part of the $2-trillion stimulus package signed into law by President Donald Trump last week.
It is still unclear, however, how the federal funds will be disbursed in California. And with record numbers of people already filing for unemployment payments state-wide, it’s also unclear how long workers will have to wait to see a check.
The state processed 878,727 unemployment claims last week, a 370 percent increase from the week prior, according to the California Employment Development Department. On Tuesday Gov. Gavin Newsom announced 1.6 million Californians had filed for unemployment since the coronavirus shutdown began.
Though the state EDD says standard unemployment claims will continue to take 3 weeks to process, the department also said it is developing an entirely new program to handle claims from workers who would not typically be eligible for compensation, including gig workers and the self employed.
The EDD did not provide a timeline for when that program will be up and running, but did indicate a different application would need to be filled out.
Meanwhile, some gig workers say they are running out of time.
“Within a week or two, if I don’t see any additional income, I’m out of money,” said Aden Alva of Alameda, who has been driving for Lyft for over 5 years. “I have no reserves of any kind.”
Alva, who relies on Lyft as his primary income source, said he stopped driving altogether a few days ago after he saw his earnings drop so drastically that he wasn’t even sure if he was netting a profit after expenses.
Though Alva has applied for unemployment, his chances of seeing a check right away seem slim.
“They are saying they are overwhelmed with requests,” Alva said. “I got confirmation they received it, that’s all I know.”
Rideshare operators like Alva account for 15% of all intra-San Francisco vehicle trips, according to a 2017 report from city officials. Numbers from the California Air Resources Board indicate over 640,000 ride-hails operate state-wide.
And with only necessary trips from home allowed, roadways have gone quite. Traffic congestion in The City during peak times is down by nearly 50 percent this week compared with averages from 2019, according to TomTom traffic data.
The drop-off in gig-worker’s income has sparked renewed pressure from advocates and some lawmakers to enforce Assembly Bill 5, the California legislation designed to force companies like Lyft and Uber to reclassify private contractors as employees, thus allotting them benefits and protection like unemployment and paid sick leave.
Wednesday, a federal judge stopped short of requiring Uber to reclassify its California drivers as employees during the coronavirus pandemic — but did urge the company to provide its drivers with short term benefits during the crisis.
The Board of Supervisors passed a resolution this week urging local enforcement of AB5.
Lyft and Uber maintain that the bill does not apply to their drivers, arguing that reclassifying drivers could limit hours and flexibility. Uber says most of its drivers prefer to work as private contractors rather than employees. They’ve also pointed to their role in providing essential services, recently pledging to provide 10 million free rides for healthcare workers and others in need.
Either way, it will likely take years of litigation before the issue is settled, according to Bill Sokol, a labor lawyer and San Francisco State University labor studies lecturer.
“AB5 is there, it’s in the books, it says these people are supposed to be paid,” he said. “It’s in the courts, and lawsuits take 3 to 5 years if you’re lucky.”
In the meantime, the stimulus package, which is slated to provide unemployment payment to gig workers though the end of the year, is being viewed by some as a bailout for tech giants like Uber and Lyft, who have not been required to pay into the system with unemployment taxes.
“There’s no reason why businesses who are doing the right thing, who are classifying their workers correctly, and taxpayers and the state need to pick up the Uber and Lyft tab,” said Lauren Casey, an organizer with Gig Workers Rising, a group supporting gig workers organizing for better treatment.
“They’re calling on the states and the federal government to ensure these folks have access to unemployment insurance and turning around and saying no we’re not going to pay the unemployment insurance because these workers are not employees,” said Casey.
Uber CEO Dara Khosrowshahi requested aid for gig workers as part of the federal stimulus package in a March 23 letter to President Trump.
“My goal in writing to you is not to ask for a bailout for Uber, but rather for support for the independent workers on our platform and, once we move past the immediate crisis, the opportunity to legally provide them with a real safety net going forward,” the letter read.
Bailout or not, gig workers need the money, says Sokol, the labor lawyer.
“I am not a big fan of demanding the perfect in such a way that you stop the good from happening,” said Sokol.
“The perfect solution would be companies pay,” he said. “It isn’t going to happen. So now, either you say ‘fuck ‘em god damnit’ or you say, ‘let’s at least get some money to them so they don’t starve to death.’