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california

Gov. Newsom’s ‘petitions’ + Prop. 22 backers reunite to lobby + CalChamber’s vaccine campaign

COALITION REFORMS ‘TO PROTECT APP-BASED DRIVERS’

Last year, gig economy giants like Uber and Lyft built a coalition of organizations to help them pass Proposition 22, the initiative that generally exempted them from the new California law that requires businesses to give employment benefits to more workers. 

Now, the Protect App-Based Drivers and Services Coalition is uniting again to lobby for “access to independent, app-based work, and preserve the availability, affordability, and reliability of on-demand app-based rideshare and delivery services that are essential to California’s economy,” according to a group statement.

Its first target is Assembly Bill 286, which caps charges for a food facility’s use of a platform such as DoorDash to 15% of an online order’s purchase price. The bill is authored by Assemblywoman Lorena Gonzalez, D-San Diego. Gonzalez wrote also wrote Assembly Bill 5, the employment law that was weakened by Prop. 22 last fall.

“As an immediate priority, the coalition is actively working to oppose legislation that would restrict access to app-based work and services such as Assembly Bill 286, which would impose unworkable new regulations on app-based delivery services that would raise consumer prices, decrease customers for restaurants, and reduce earning opportunities for drivers,” the group said in a statement.

Members of the coalition include the Congress on Racial Equality, the National Taxpayers Union, the California Narcotics Officers Association, the Consumer Choice Center, Uber, Lyft, DoorDash and Instacart.

Originally published here.

California’s AB 286 is a hidden tax on consumers and small businesses. The legislature should vote NO

Our coalition of community organizations, minority-owned businesses, small businesses,
taxpayer advocates restaurants, merchants and app-based drivers strongly oppose Assembly
Bill 286. While AB 286 purports to help restaurants and merchants, the bill will result in
increased costs to consumers, reduced business and revenues for restaurants, and fewer
income-earning opportunities for drivers.

AB 286 is a hidden tax on consumers and small businesses and would hurt the very restaurants
it is intended to protect.

App-based delivery platforms connect restaurants, customers, and drivers. Fees are carefully
balanced to reflect the mutual benefits to each party: fees on restaurants help pay for marketing,
payment and insurance for drivers, customer service, and other services that help restaurants
gain customers and grow business. Fees on customers reflect the convenience and value of the
delivery service while also ensuring fair payment to drivers.

AB 286 would arbitrarily and permanently cap fees paid by restaurants and will force prices to
rise on consumers in order to ensure adequate revenues to provide app-based delivery
services. For instance, a 15% cap on a typical $20 food order is $3. That $3 is insufficient to
pay for the driver, insurance, marketing, credit card processing fees, customer support,
technology, and costs of operating the platform.

Because of this, in communities that have passed these arbitrary fee caps, consumer prices
have increased to compensate and ensure that app-based delivery remains viable. In cities that
have implemented these arbitrary fee caps, consumer costs have immediately gone up by $2-3
per order.

Higher prices are proven to reduce demand by as much as 30%, taking away customers and
business from restaurants that are struggling to stay afloat during these challenging times. AB
286 will be particularly harmful to small independent restaurants trying to compete with larger
chains that have their own marketing and even delivery services. Furthermore, while AB 286
purports to help restaurants struggling with the pandemic, it is permanent in nature and won’t
even go into effect until 2022.

And the higher prices also harm drivers working with app-based platforms, as reduced demand
for services means fewer work opportunities for drivers, less income for drivers and reduced
sales tax revenues for municipalities.

Finally, AB 286 is unnecessary. California recently passed legislation (AB 2149) that requires
app-based platforms to enter into a contract with every restaurant and merchant they list on
their app. As a result, every restaurant or merchant that utilizes app-based delivery services
has voluntarily entered into an agreement with full transparency into the terms, fees, and
benefits of partnering with these platforms.

We strongly urge you to vote No on AB 286. It hurts restaurants, customers, and app-based
drivers.

Sincerely,

Lily Rocha, President, Latino Restaurant Association
Julian Canete, President & CEO, California Hispanic Chambers of Commerce
Pat Fong Kushida, President & CEO, CalAsian Chamber of Commerce
Rev. KW Tulloss, President, Baptist Ministers’ Conference of Los Angeles and Southern California
Matt Regan, Senior Vice President, Bay Area Council
Cindy Roth, President & CEO, Greater Riverside Chambers of Commerce
Reuben Franco, President & CEO, Orange County Hispanic Chamber of Commerce
Elise Swanson, Chair, South Bay Association of Chambers of Commerce
Jessica Lall, President & CEO, Central City Association – Los Angeles
Yaël Ossowski, Deputy Director, Consumer Choice Center
Heidi L. Gallegos, President & CEO, Brea Chamber of Commerce
Leah Vukmir, VP of State Affairs, National Taxpayers Union
Moises Merino, President, Latino Leadership & Policy Forum
Ruben Guerra, President and Chair, Latin Business Association

Rev. Jonathan E. Moseley, Western Regional Director, National Action Network – Los Angeles
David Cruz, President, League of United Latin American Citizens Council 3288
Jay King, President & CEO, California Black Chamber of Commerce
Faith Bautista, CEO, National Diversity Coalition
Stuart Waldman, President, Valley Industry & Commerce Association (VICA)
Marc Ang, Founder/President, Asian Industry B2B
Peter Leroe-Muñoz, General Counsel, SVP, Tech & Innovation, Silicon Valley Leadership Group
Thomas Hudson, President, California Taxpayers Protection Committee
Adam Ruiz, Chair, Southwest California Legislative Council
Faith Bautista, President & CEO, National Asian American Coalition
Brandon M. Black, Director of Public Policy, Sacramento Metropolitan Chamber of Commerce
Thomas Hudson, President, Placer County Taxpayers Association
Dominik Knoll, CEO, Redondo Beach Chamber of Commerce
Cindy Spindle, CEO, Garden Grove Chamber of Commerce

PDF LINK HERE

California’s political leaders are pushing rideshare companies and consumers will suffer

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San Francisco, CA – On Wednesday, the CEO of Uber said that if California’s AB5 law is carried out against rideshare firms, the company will consider pulling all of its services from the state.

Yaël Ossowski, deputy director of the Consumer Choice Center, a consumer advocacy group, calls it a “sad day” for California rideshare consumers drivers.

“Through AB5 and similar legislation, California’s politicians have been sending the signal that rideshare companies are not welcome in the Golden State. But that’s not what consumers want,” said Ossowski. “The flexible model that has so far propelled the growth of companies like Uber, Lyft, and others has been beneficial for both drivers who want independence and consumers who want convenience and competitive prices.

“If Uber and other companies shut down in California, it will prove that the state is no longer a hotbed of innovation, but rather the place where innovation goes to die. It’s unfortunate that millions of Californians will be deprived of more choice if that happens. The same has also proven true for the thousands of freelancers who now find themselves out of work.

“California politicians may have the noblest of intentions, but forcing rideshare companies to become taxi companies does nothing but help the taxi cartel maintain its monopoly and deprive people of earning a living on their own terms.

“Hopefully, voters will choose to support Prop 22 in the fall to reverse course and restore the ability of drivers and other freelancers to earn a living how they want,” said Ossowski.

##

The Consumer Choice Center represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva, and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

CONTACT:

Yaël Ossowski

Deputy Director

Consumer Choice Center

yael@consumerchoicecenter.org

Is the gig economy bill a disaster or triumph for ride-hailing? Depends on who you ask

Uber and Lyft have been warning drivers about the end of flexible schedules, and passengers about more expensive rides that take longer to arrive, all thanks to a California bill that passed this week. 

But drivers and other gig workers are celebrating what could be a pathway to fair pay, benefits, and other employee rights, which some claim will come at only a slight cost to riders.

After the bill, called AB5, makes its way to the governor’s desk, it should go into effect on Jan. 1, 2020. It would make companies reclassify many independent contractors as employees, something Uber and Lyft have opposed. 

While this would directly affect drivers and other gig economy workers, like the 200,000 in California working for Uber, the people who use the apps could also see changes. 

The New York Times cited “industry officials” who say costs for companies like Uber and Lyft could rise by 20 to 30 percent because of AB5. Other industry experts like Michael Droke, a partner at Dorsey & Whitney in California, a law firm that has represented big companies like 3M and Wells Fargo in labor disputes, also sees costs going up for companies and prices going up for riders. 

“Many industries rely on independent contractors to deliver products and services, from food delivery to software coding and design. Those workers will be converted to employees, significantly increasing the cost of the products and services,” Droke said. 

Yaël Ossowski, deputy director of the Consumer Choice Center, which supports deregulation, said the law could force people to “seek out alternatives.” Instead of ordering a cheap ride, he thinks people will be forced to do things like carpool, hail a cab, or find a nearby bus.

Read more here

California’s effective outlawing of contractors will make consumers worse off

California’s effective outlawing of contractors will make consumers worse off

Sacramento, CA – On Tuesday, the California State Senate voted in favor of AB 5, requiring all companies using contract workers in the state to treat them as employees. Gov. Gavin Newsom is expected to sign the bill.

Yaël Ossowski, Deputy Director of the Consumer Choice Center, responded to the law’s passage:

“The proponents of this bill are celebrating the fact that they’re all but shutting down the prospects for the entire sharing economy and thousands of other industries in California,” said Ossowski. “The plain fact is this will hurt more people than it purports to help, depriving consumers of the innovations that have made their lives better and more prosperous.

“That includes home deliveries, home healthcare, ride-share, handyman apps, antique selling, and thousands more businesses and applications that millions of contractors and even more consumers have used,” said Ossowski.

“State Sen. Maria Elena Durazo said this proves lawmakers are “determining the future of the California economy.” She’s right. And they’re doing it by stamping out innovation. It will ultimately be California’s sharing economy consumers who foot the bill for this heavy-handed intervention, as well as anyone who relies on contracting work to get by.

“The entire gig economy has grown and been successful because it offers alternatives to consumers and workers alike, who all benefit. Changing employment law to make certain business relationships illegal will deprive millions of people of the opportunity of using these services, and cause even more repercussions for those who rely on them, both consumers and workers.

“California’s move is heavy-handed, paternalistic, and favors the monopoly of larger traditional companies more than people who rely on this new sector of our economy. That’s a shame,” said Ossowski.

A Consumer Choice Center survey from March 2019 found that 72% of Americans believe the government should protect the freedom of choice for consumers.

The same survey found that 69% of Americans think policymakers don’t spend enough time listening to consumers before proposing new regulations.

More information can be found on our website.


***CCC Deputy Director Yaël Ossowski is available to speak with accredited media on consumer regulations and consumer choice issues. Please send media inquiries HERE.***

—The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

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