If you find work as a contractor or in the gig economy, you may be aware of the recent debate over classification. With a new law, you may find yourself able to seek regular employment with the protection of workers’ compensation and overtime laws. But the battle over the law is not over.
As of the first of the year, all California companies now have strict limits on how they classify workers. The new law that went into effect changes the rules for who can be a contractor instead of a regular employee. But rideshare companies like Uber, Lyft and Postmates refuse to back down.
Gig companies are trying to change or block the new law
When the law went into effect, many companies had to decide how to reclassify their employees. But companies Uber, Lyft and Postmates have not complied.
Instead, they have filed a federal lawsuit to try and block the new law. They have also tried to work with lawmakers to create a new employee classification that would allow them to keep hiring workers as contractors.
If those don’t work, gig companies hope a ballot initiative will make them exempt from the new law.
The law protects workers’ basic protections
When the law went into effect, it hoped to offer protections for more workers. Many companies try to classify people as contractors to avoid paying overtime or workers’ compensation coverage.
To prevent this abuse, the law raises the restrictions for the type of work contractors can do. If a worker goes beyond these restrictions, the company must consider them a regular employee.
As gig companies dig their heels in, you may see a change to the new law. But for now, companies in California can’t abuse classification to deny you basic employment protections.