AB5: Defeating The General Election Ballot Measure

AB5: Defeating The General Election Ballot Measure
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Gig Workers Rising Statement in response to aualification of General Election Ballot Initiative funded by companies

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Q1 2020 hedge fund letters, conferences and more

Today the Proposition funded by Uber, Lyft, Doordash, Instacart, and Postmates, was certified by the Secretary of State to appear on the November 3rd General Election ballot.

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The General Election Ballot Initiative

The Proposition seeks to do two things:

  • Give the companies a complete exemption from AB5, the law that went into effect in January 2020 in California that classifies gig workers as employees and gives them benefits. Since the law went into effect the companies have refused to obey it.
  • It’s a scathing attack on basic workers’ rights. If passed it would allow the gig companies to:
    • Avoid ever paying for overtime, critical work expenses (such as full mileage or cell phone reimbursements), or even meeting the state’s minimum wage;
    • Discriminate against drivers on the bass of immigration, language, and citizenship status;
    • Deny workers health or income protections if they are hurt on the job; and
    • Prevent workers from accessing a single day of paid sick or family leave or the unemployment benefits many need during this pandemic.

This proposition is regressive and deeply harmful to workers. It guts a broad swath of worker protections in California while simultaneously preventing local governments from regulating these companies or the legislature from ever changing the law.

In the midst of a global pandemic, when drivers are out of work and the gig companies have laid off thousands of workers, they are going full steam ahead with the plan to spend $110 million on this campaign.

We will be campaigning to stop these companies from denying workers basic rights. We will fight tirelessly to defeat this General Election ballot measure and we call on the people of California to reject it wholeheartedly.

Companies Will Do Anything To Protect Their Profits

The Proposition is another reminder that these companies will do anything to protect their profits. This initiative would formalize into law treating gig workers like second-class citizens even while shouldering them with the majority of risks and expenses associated with operation transportation of delivery services. As we’ve seen during this pandemic, Uber and Lyft have successfully avoided paying $413 million into unemployment, meaning other law-abiding citizens and corporations are left to pick up their tab.

As we write this, drivers are on the frontlines of exposure to this virus, yet the companies are fighting tooth and nail to prevent them from accessing paid sick leave, unemployment insurance, and vital workplace protections. Despite what the companies say in their press statements, it’s been next to impossible for drivers to access PPE and sick leave under the companies’ own policies. A new report from the University of Santa Cruz found that only 19% were offered procedures or support for what to do if they exhibit symptoms of the virus and 55% said their app was doing nothing or not enough to respond to the virus.

“Executives like Dara Khasoggi, the Uber CEO and Apoorv Mehta, the Instacart CEO, in the face of a global pandemic continue to put workers in danger while attempting to gut any protections workers may have, forever. This is a clear fight between us workers and a handful of elite billionaires. That’s what this all comes down to. The people of California will side with workers, not these greedy elites who will stop at nothing for the sake of profits. For many years people said gig workers couldn’t be organized, but look at us now. We won’t stop until we have a union and the dignity and respect we deserve.” Carlos Ramos, a driver with Gig Workers Rising

“This Proposition doesn’t just exempt the companies from AB5 it totally rewrites decades of laws that are in place to protect workers. And on top of that, the companies are attempting to buy themselves out of a democratic process. They are trying to buy themselves a whole new law. We must ensure this measure is defeated at the General Election ballot box in November.” Lauren Casey, an organizer with Gig Workers Rising.

Gig Workers Rising is a campaign supporting and educating app and platform workers who are organizing for better wages, working conditions, and respect. @GigWorkersRise

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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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