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Will Unionization Help or Hurt Seattle’s Rideshare Drivers?

The potential unionization of ride share drivers, and their version of collective bargaining, may change how Uber, Lyft and other the App-Based Drivers Association (ABDA) organizations operate.

Independent Contractor? You Mean, “Driver”?

The ability to unionize is something in which many American workers partake. From auto workers to teachers, different industries and people engage in what is known as “collective bargaining” in order to ensure livable wages, good working conditions, healthcare, etc.

But the ability to unionize for these app-based drivers poses a different dynamic to the simple concept of gathering your coworkers to push for better benefits. Instead of “employees,” drivers for such organizations are called “independent contractors” and, according to companies like Uber and Lyft, this new ability to unionize isn’t going to change that title.

Collective Bargaining? Not So Much…

By bargaining collectively, it is the employees who gather and do the majority of the bargaining. But unlike most instances, the app-based drivers are not considered actual “employees” and aren’t under the federal umbrella in terms of negotiating wages and conditions. The National Labor Relations Act doesn’t give independent contractors the same protections as employees when bargaining directly with companies, but this bill offers a workaround by allowing a certified non-profit to represent the interests of drivers. The non-profit must gain support from the majority of the drivers in order to represent them.

The reason it is so important is that instead of the bargaining being done by the “independent contractors,” the non-profit or organization that is affiliated with any particular company is going to represent all those drivers. This could pose many problems, most notably the possibility that the non-profit only pursues its own agenda rather than that of the drivers.

Furthermore, the non-profit and app-based driving company must reach an agreement that will be enforced by the city. This makes it seemingly inevitable that enforcement of the agreement will come via bitter litigation battles.

If It Isn’t Broken, Don’t Fix It!

When you hear the phrase “unionize” or “union” you often think, “Good for them! Better conditions, better wages, awesome.” However, this recent development may actually have a negative impact on drivers. Given the fact that the city is enforcing the agreement, consumers and drivers can now look forward to vehicle regulations, fines, and penalties that make a quick trip to the airport a whole lot more complicated.

These new practices beg the question of whether drivers will actually be hurt by the recent decision. Instead of somebody making some money in their free time or just trying to catch a quick ride, both of these parties must now operate and engage in services with the bureaucratic overhead of municipal enforcement. Effectively, these changes may end up raising prices for consumers, leading to a decrease in ridership and less work for the drivers themselves.

Our Take

The simplicity of connecting consumers with services and goods quickly and easily is the driving force behind the sharing economy. By giving the ABDA the ability to unionize, the Seattle City Council is trying to fix something that isn’t broken. Rating systems, incentives to provide great service and the ability to make money in one’s free time could potentially be threatened by this unionization soirée.

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