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The gig’s up on the gig economy as contract workers vote to unionize
By Erasmo Martinez, Bay News Rising staff reporter —
Tracey Kelly drives a double decker shuttle bus from South San Francisco to San Jose, picking up Yahoo employees along the way. He pilots the bus through San Francisco for about four hours, drops off employees at Yahoo headquarters, then waits for about five hours in the San Jose summer heat. His 16-hour work days end after he takes the workers back home.
“For what we’re carrying we should get paid better,” said Kelly, who drives for Compass Transportation and earns $18 an hour. “(Passengers) have got families and they’re precious cargo. They’re not boxes.”
Kelly did more than complain. He called the Teamsters to unionize the drivers from Compass Transportation and is involved in an ongoing effort to win a contract. His concerns are echoed across Silicon Valley as the low-paid service workers of the “gig economy” start to unionize and take to the courts in a battle for living wages and job security.
In recent months:
• Taxi drivers, who have seen their incomes plummet as ride sharing companies snatch their fares, are fighting back as well; they’ve recently formed a union.
• Google Express contract workers will soon vote for union representation by Teamsters Local 853 because of poor working conditions and hourly pay as low as $13 an hour.
• Contract workers are going to court, suing ride-sharing and on-demand house cleaning companies, with the aim of winning employee status and the right to overtime pay and other traditional benefits.
The first on-demand workers in the Bay Area to win a significant victory were shuttle bus drivers, men and women who work long split-shifts for low pay taking tech workers from San Francisco to Silicon Valley and back. Not only do the drivers and their allies in the Teamsters Union have to battle the owners of the bus companies, they have had to take on tech giants, including Apple and Facebook, which contract with the transportation outfits.
Drivers for Loop Transportation, a Facebook contractor, joined the Teamsters and approved a contract in the spring of 2015. Their pay jumped from about $18 an hour, the same pay Kelly earns, to $27.50 an hour while driving and about $18 an hour during wait periods.
Health care coverage, overtime and five weeks paid vacation are a few of the other benefits won by the workers at Loop and Kelly says he wants the same for him and his co-workers. “This is not just about wages,” he said. “It’s about better health and welfare. Not only will this attract drivers, but good drivers.”
There are already signs that the tech companies are worried, says Rome Aloise, vice president of Teamsters Local 853. Apple requested that bus drivers working for its contractors get a 25 percent raise to $25 an hour.
“Facebook made a significant difference,” said Aloise about the Facebook contract’s effect. “They all increase the pay as a result of this. That’s their attempt to keep the union out.”
Six companies, including Apple, Facebook, and Zynga, hold contracts with the transportation companies, he said.
San Francisco taxi drivers decided to organize after Uber and Lyft decimated their business. Drivers say competition from the ridesharing companies has reduced their income by as much as 30 percent. Driver formed the San Francisco Taxi Drivers Alliance in August of 2014 and it is part of the AFL-CIO.
Independent workers and freelancers now make up as much as one-third of the U.S. workforce, but the taxi drivers are the first union of independent contractors to join the AFL-CIO, said Kim Waldon, a spokesperson for the Taxi Alliance. The affiliation allows the taxi industry to use the AFL-CIOs legal resources to push for regulations of ride-sharing companies and gives drives access to health insurance.
Protection for workers convinced Tara Spalty to join a union. She made about $25 an hour as a Lyft driver. That’s better than minimum wage, but too much cash went into insurance coverage, gas and car maintenance, she said.
“Within the first two months I had to get all new brakes,” she said. “That stuff starts to cost a lot of money.” Now she’s a union member and rents a cab from one of the taxi companies.
Cliff (he asked that his last name not be published for fear of job loss), is one of the many drivers who makes ends meet by driving for Lyft and Uber. A former construction contractor, Cliff is glad to have the work and admires the innovative business model pioneered by Uber. But he said the lack of workers’ comp, benefits and reimbursements for maintenance mean that the business model doesn’t work all that well for him.
Uber drivers have yet to unionize. But they and other service workers are engaging in legal battles to gain more rights. The California Public Utilities Commission ruled that a driver counts as an employee in June. The commission said the driver’s independent contract work followed employee status under California labor laws.
The victory is a limited one: It only applies to the driver, Barbara Ann Berwick, and Uber is appealing the ruling. But the decision might pave the way for actions that could set a wider precedent.
“The sharing economy doesn’t change the fact that companies do not have the (right to flout) the law,” said attorney Jonathan Davis.
Davis and the Arns Law Firm filed a lawsuit against Instacart, whose workers use their own cars to deliver groceries. If the drivers really were contractors, said Davis, they would be able to negotiate directly with a customer and decide when they wanted to make deliveries. But they can’t.
Workers at Homejoy, an on-demand cleaning service, filed a similar lawsuit. Cleaners had no say in where their cleaning job would be and often traveled long distances between jobs — from San Francisco to Oakland and back, for instance — without any reimbursements for expenses, like gas and cleaning supplies. What’s more, they were not paid for overtime.
Both companies have responded to the legal actions. Homejoy CEO Adora Cheung wrote a blog post on the company website delivering the news that her company was folding. The lawsuits were cited as a main decider. Instacart announced in early June the hiring of part-time employees and categorizing some contract workers as employees.
“Companies hold all the cards,” said Byron Goldstein, an attorney in the Homejoy case. “Without these labor protections there would be significant abuse of the laborers.”
Davis said his firm is noticing an uptick in the lawsuits filed against companies from workers “frustrated by the pay and lack of reimbursements while being treated as employees.”
The lawsuits and the union victories are a source of hope for workers in the gig economy. Tommy Leyva, a driver for Compass Transportation, has been renting a room in an apartment in San Jose. But life will be better when his raise kicks in.
“Now people can enjoy their lives,” he said with enthusiasm about the pay increases. “My goal right now is to get back into a home.”