California officials and legislative leaders backed a compromise allowing rideshare drivers to form unions and bargain collectively while retaining independent-contractor status. The agreement advances a collective-bargaining bill backed by the Service Employees International Union alongside an Uber- and Lyft-sponsored bill that would cut the companies' insurance requirements. Uber and Lyft contend current insurance rules drive litigation and increase passenger costs. The deal aims to balance stronger driver representation with lower operational costs for rideshare platforms. The compromise follows longstanding disputes over worker classification since the 2019 changes to state employment law.
"Labor and industry sat down together, worked through their differences, and found common ground," Newsom said in a statement. The agreement, he said, will "empower hundreds of thousands of drivers while making rideshare more affordable for millions of Californians."
The two bills "represent a compromise that lowers costs for riders while creating stronger voices for drivers," said Ramona Prieto, Uber's head of public policy for California, in a prepared statement.
The companies have argued that current insurance requirements are so high that they encourage litigation for insurance payouts and create higher costs for passengers.
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