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Thursday, September 05, 2019


Richard Markuson

The Interesting Elements of Assembly Bill 5

Many of you San Diego-area folks remember Assembly Member Lorena Gonzalez from her tenure as head of the San Diego-Imperial Counties Labor Council (AFL-CIO). She left that post in 2013 when Assemblyman Ben Hueso was elected to the State Senate. She then decided to bring her style of political activism to Sacramento by winning Hueso's 80th Assembly District.
She is a prolific author - usually having multiple pieces of legislation on the CalChamber "Job Killer" list. One bill that is NOT on the list - but certainly qualifies as a job killer - is AB 5, which will codify the State Supreme Court decision in the Dynamex case that changed the treatment of independent contractors (we cover some recent amendments to that bill elsewhere). The reason I suggest it is a job killer is because its primary targets are the gig economy workers who accepted employment under the old rules - for any number of reasons - and now will become employees of their contracting entity - whether they want to be an employee or not. Uber - by far the largest of the gig employers (and who recently lost $5 billion in the last quarter) has suggested that 300,000 of their contractors will be terminated if AB 5 goes into effect as currently drafted. And the votes are probably here to pass the bill, and Governor Newsom has signaled he is prepared to sign it.
But this is not about the gig economy or AB 5, but rather, this is an interesting "side-bar" that is taking place around the bill and efforts to provide some degree of flexibility to gig workers - or as some have described it - a "third" status of employment (the other two being employee and independent contractor).
There seemed to be some degree of interest in this concept among the Democrats in Sacramento who don't necessarily want to be seen as executioner of the gig economy as we know it (which includes paper boys, who would become employees of the few remaining printed papers in California). Uber, Lyft, DoorDash and some of the other employers have offered wage floors, collective bargaining (industry-wide as opposed to employer by employer) and other protections without these folks becoming statutory employees.
The author seemed reluctant to go down this road and preferred to hand out industry exemption on a case-by-case basis - always with the approval of organized labor. But lo and behold, the loudest opponent to this was none other than Mr. Robbie Hunter. You may recall the last column, which listed Mr. Hunter of the State Building and Construction Trades Council as the fifth most influential power figure in Sacramento.
At about this same time, Governor Newsom announced members of his Future of Work Commission.
The executive order establishing the Commission states, "The Future of Work Commission's primary mission shall be to study, understand, analyze, and make recommendations regarding the kinds of jobs Californians could have in the decades to come; the impact of technology on work, workers, employers, jobs and society; methods of promoting better job quality, wages, and working conditions through technology; modernizing worker safety net protections; and the best way to preserve good jobs, ready the workforce for the jobs of the future through lifelong learning, and ensure shared prosperity for all." The Commission is replete with union officials, Obama appointees, and left-leaning academics along with a few token business representatives but missing from the list was good ol' # 5 - Robbie Hunter.
It seems Hunter was prepped to serve but things went a little sideways when the trades went a little postal on the "third status of employment."
As CalMatters reported the "disinvitation," Gov. Gavin Newsom's administration revoked the appointment of one of California's top labor leaders to a soon-to-be announced Future of Work Commission on Tuesday, in an escalating dispute over how to treat gig employees. Robbie Hunter, head of the State Building & Construction Trades Council of California, is insisting that gig employees, including construction workers who get jobs through Handy, be treated as employees, not independent contractors. Hunter and Newsom's chief of staff, Ann O'Leary, argued over the issue earlier this month, leading Hunter to conclude the administration would make concessions to companies such as Uber, Lyft and Handy. On Tuesday night, a top aide to Newsom called Cesar Diaz, the building trades' chief lobbyist, to say Hunter's appointment was revoked-this after the administration emailed a draft press release to Hunter on Friday afternoon announcing his appointment.
And in a curious and possibly unrelated dis-appointment, Newsom also has dumped Nikki Noushkam, his recent appointment to the South Coast Air Quality Management District.
Noushkam worked at ExxonMobil from 1997 to 2001 and Northrop Grumman from 2004 to 2015. Most recently, she served as chief engineer for Aerospace Corp. since 2015. Newsom appointed her last month but apparently had second thoughts. "While the governor was impressed by the technical and engineering expertise of the nominee, the governor is withdrawing his previous nomination to the South Coast Air Quality Management District," Newsom spokesperson Nathan Click said in a statement. "Given the air quality challenges faced by families in Southern California, the governor believes his appointee should have both a strong understanding of public health and the trust of local communities."
So, how does one connect those dots? CalMatters noted: "The decision to pull the nomination of Negar "Nikki" Noushkam coincided with the Newsom administration's decision to revoke the offer to Robbie Hunter, head of the State Building & Construction Trades Council of California, to serve on the Future of Work Commission." And "... the building trades council represents unionized oil refinery workers, has an alliance with oil companies, and supported Noushkam's appointment." Connection? Maybe. But the trades have stepped up their lobbying against a gig fix - and dispatched about 100 construction workers (paid for with industry advancement money, undoubtedly) today to the Capitol to remind Democrats (and Republicans) who is calling the shots.
We'll know how this resolves by Monday - the start of the marathon last week of session when the deadline for amending bills before Friday's adjournment has passed.