SACRAMENTO (CBS13/AP) – The California legislation that could transition tens of thousands of so-called “gig economy” workers from independent contractors into full-time employees has been signed into law.
California Gov. Gavin Newsom signed Assembly Bill 5 into law on Wednesday and called the legislation an important step to building the middle class.
The law makes it harder to classify workers as independent contractors as opposed to employees – since employees are entitled to more stringent wage protections and other benefits.
Ridesharing companies like Uber and Lyft, along with on-demand delivery companies like DoorDash and Postmates, have argued that this new classification upends their business model. Drivers for those companies have expressed concerns over what the law means for flexibility.
Uber, Lyft and DoorDash have threatened to push for a $90 million ballot measure in California to fight the bill if it became law.
Reporting from the Associated Press contributed to this report.